Auckland-based non-bank depository firm FE Investments, which went bankrupt last year and owed investors $ 55 million, could face legal action by liquidators.

The liquidator of the failed non-bank deposit taking FE Investments says he has identified “potential claims” against the company, that sank at the beginning of last year holding approximately $ 55 million in depositors’ funds.

The company, which was a subsidiary of a publicly traded company in Australia, had been in trouble for some time.

EY (Ernst & Young) liquidator Rhys Cain said in his latest report that “the merits of continuing these collection actions for the benefit of creditors are under review.”

He said he has completed the investigation into “company affairs”, and the investigation report is now being finalized. The records of the company and the conduct of the directors of the company had been examined to determine whether there had been any actions by the directors giving rise to collection options available to the liquidator.

“Any decision whether or not to pursue potential actions depends on several factors, including the evidence available to the liquidators, the merits of any claim, the likelihood of success, the expected amount of recoveries and the potential costs to be recovered”, Cain said.

“As the investigations are ongoing and could be the subject of litigation in the future, the liquidator is not in a position to elaborate further on these matters at this time. competent authorities.”

Cain said the “complex issues” involved took considerable time to review all relevant company information, including documentation, emails, and interviews with former company employees and key figures. stakeholders as part of the information gathering process. A review of compliance with FMC regulations, Companies Act (in particular the duties of directors) has been undertaken.

The company is also still in receivership.

Cain said he had been advised that if there was a shortfall for depositors from receivership, then they would be entitled to liquidation.

He said the latest receivership report showed that about $ 7.53 million in distributions had been paid to depositors from the company’s assets so far, leaving about $ 47 million remaining in claims. first rank deposit.

Here is the summary of unsecured debts:

The liquidator does not at this stage give a timetable for the closing of the liquidation.

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