Hubbard Fund Overstated

By Nick Mclaughlin
Nick Mclaughlin
Nick Mclaughlin
August 27, 2010 Updated: August 27, 2010

[xtypo_dropcap]I[/xtypo_dropcap]nvestors in Hubbard Management Funds (HMF) have been told the reported value of their investments at March 31 was overstated by at least 25 percent, the New Zealand Herald reported.

Another company run by Timaru businessman Allan Hubbard, Aorangi Securities Ltd., may also suffer a loss.

Richard Simpson of Grant Thornton New Zealand said, “As statutory managers we are aware that this news will be a shock and a disappointment to the many people who have invested in these businesses operated by Mr Hubbard,” NZPA reported.

"We are mindful that some people depended on the flow of funds from HMG and Aorangi for their day-today living and that the freezing of the funds under statutory management has created hardship for them. For those people, an emergency fund has been established.”

These comments were made in the second report to investors.

"In the case of Aorangi, an underlying problem we are dealing with is that Mr Hubbard has allowed Aorangi to accept deposits of about $96 million from investors on call, but he invested those funds in investments or loans which are nearly all long term in nature,” said Mr. Simpson.

No evidence has been announced by the Serious Fraud Office relating to wrongdoing on the part of Mr. Hubbard.