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Ross Asset investors treated for depression

The Ross Asset Management liquidation is taking its toll on investors, with some being treated for depression.

David Ross has now been temporarily stripped of his Institute of Chartered Accountants membership, in an interim suspension decision revealed yesterday by the institute’s disciplinary tribunal.

The Wellington-based financial investment company was placed into liquidation before Christmas amid speculation Mr Ross may have been operating a ponzi scheme.

So far, PwC liquidators John Fisk and David Bridgman have found just $10.2 million in 1720 investor accounts out of a purported $449 million of assets.

Messrs Fisk and Bridgman have since re-employed the company’s two administration assistants to help with the collection and collation of information.

RAM investors’ group spokesman Bruce Tichbon says he knew about the disciplinary review and was not surprised at the outcome.

There is total confusion and fear among many of the 900 investors, he says, and he has been flooded with calls from concerned and confused investors.

“You’ve had this shattering event, it’s pretty cataclysmic in the New Zealand scene and obviously something which shakes the market to its core and taints everyone,” he told NBR ONLINE.

Mr Tichbon says he has heard of a number of investors who have lost a lot of money who have had to be treated by their doctors.

“I’m getting feedback from doctors saying they’ve got terribly depressed clients. One lady came to me and said she went to see her doctor because she was so depressed. She’d basically lost the family farm.

“The doctor said ‘well, I’ve got three other clients in exactly the same position – and they’re worse off than you’. And then I checked with another couple of doctors, and yes they’ve got severe cases of depression they’re dealing with.”

Meanwhile, Mr Tichbon says there needs to be more clarity around the 13 applicants for the liquidation committee.

Messrs Fisk and Bridgman want the committee to assist them and to represent the interests of the investors.

But with just three weeks until applications for the committee close, Mr Tichbon is worried about the candidates’ vested interests.

“People are coming to me and saying they don’t know what the vested positions of these people are. Are they pro- or anti-clawback? And I have had many approaches from people saying they don’t know how to vote.”

He says investors need to know people’s positions and he is quite happy to declare his interest – positive net equity.

“I don’t want to ask if they’re pro-clawback or anti- or neutral. I want to ask what their personal position is because then they have to state a fact as an answer. Those who provide the information can have it put there and those who won’t provide the information will have a blank next to their name.

“People can vote accordingly.”

bcunningham@nbr.co.nz

More by Blair Cunningham

Comments and questions

Do these people think they are the only ones who have lost money in the past few years. Many others have been left in the same or worse positions, so get over it. You went for the high returns and it didn't work out. A lesson well learned!

Thanks for that enlightening drival.

Worse position. How do you know what's worse than those people who have lost everything they have? Have you lost something important to you? Those people who lost their farms are farmers whose life revolved around their property. Now they lost that, they didn't just lose money but memories and the history of the farm they owned. I know I'm only talking about a few investors but its just annoying how someone who is not in their position is telling them to "get over it".
Most of these investors are retired and old people. Do you expect them to get over such a loss when they have nothing to use to retire on or to use once they are retired? It is a lesson well learned but don't just tell them to get over it. It's hard on them now, but it will be harder knowing that people think of them like this.

I have just been through the MF Global wringer. Liquidators were Deloittes. They have done OK. They have recovered and distributed 80c in the $1. Getting there was a drama. There were thee types of client accounts. One class of clients had segregated accounts and the others didn't. When the company went into suspension, some had serious exposure to the markets with open positions. Others didn't. Of those with open positions, some were in the money on freeze day, but out of the money on actual-realisation day. Others were the reverse. Deloittes spent 12 months going backward and forward to the Australian High Court for "directions" by the court on how to resolve the competing claims, employing solicitors and barristers. An average barrister charges a minimum of $5000 per day. Yet while all this was going on, the head liquidator of Deloittes was charging $650 per hour or $5000 per day, same as the barristers. Amazing considering a liquidator of Deloittes' standing is well versed in commercial law and able to make these decisions. Anyway, the point of it all is, in the case of RAM, there will be competing claims and PwC are capable of exercising their judgment based on legal precedent. And there are now precedents aplenty in the case of MF Global and Bernard Madoff. QED.

Upswing is pharma companies will do well on prosac sales.

If they won Lotto next week they would not be depressed any more, then?
More from the bleeding obvious file.

You offer them much comfort, Cactus. Much comfort.

They can't win Lotto next week, I am going to.

I feel for them, as I too have lost money to finance companies. Hope they get something back.

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