FMA, CBL Corporation settle one of two proceedings

FMA, CBL Corporation settle one of two proceedings | Insurance Business New Zealand

Legal Insights

FMA, CBL Corporation settle one of two proceedings

Penalty hearing to take place in due course

Legal Insights

By
Terry Gangcuangco

The Financial Markets Authority (FMA) – Te Mana Tātai Hokohoko and CBL Corporation Limited (in liquidation) (CBLC) have agreed to settle one of the proceedings filed by the regulator in 2019.

CBLC, which had a market capitalisation of $747 million before it went bust four years ago, was previously accused of failing to disclose material information to the market during 2017 and 2018. Part of that case were former directors Sir John Wells, Tony Hannon, Paul Donaldson, and Ian Marsh.

In a release, the watchdog said a settlement agreement has been reached with the CBL Insurance Limited (in liquidation) parent and the four ex-directors.

“The FMA is progressing an in-court settlement with CBLC and the independent directors in the continuous disclosure proceeding,” noted FMA enforcement head Margot Gatland. “The next stage will be a penalty hearing.

“However, that proceeding still continues against Peter Harris, Carden Mulholland, and the estate of Alistair Hutchison. The IPO proceeding is also ongoing. The trial for these proceedings is set down for April 2024.”

The initial public offering case, which has not settled, relates to the documentation supporting CBLC’s IPO in 2015. The proceeding was filed by the FMA against CBLC, Harris, Hutchison (who passed away in 2021), and Mulholland.

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