Pyne
Gould Corporation is winding down its public borrowing through Perpetual
Trustee after getting its hand smacked following allegations that funds were
being siphoned off to further the private interests of Pyne Gould’s majority
owner, George Kerr.
In July 2012, the High
Court appointed two individuals from accounting firm WHK to the board of
Perpetual Trust as minders to oversee promised repayments by interests
associated with George Kerr.
This followed evidence
that Perpetual Trust funds had been used to refinance the Torchlight fund,
another investment vehicle controlled by Kerr.
Some $28.6 million had been siphoned off to Torchlight. It was to later come out in court that a Mr
Tinkler, also a senior executive at Pyne Gould, had received $3.3 million from
Perpetual; supposedly a loan but there was no written application for the loan
and no security had been given for the advance.
Any continued need for
observers on the Perpetual board was reviewed by the High Court in August
2012.
The court was told the
advances both to Torchlight and Mr Tinkler had been repaid. Further evidence was given that the public
arms of Perpetual Trust’s business were to be wound up.
Perpetual’s Cash
Management Fund is to stop making any further loans and to stop borrowing from
the public. It is intended that existing
public investors will be paid on maturity from new funds borrowed by Perpetual
from private sources. Investor
repayments will be dependent upon timely realisation of Cash Management assets
and Perpetual’s ability to refinance from private sources.
Another investment
vehicle, the Perpetual Mortgage Fund, is to be liquidated. Repayments to investors have been frozen
since early July.
High Court orders were
made to have the two observers remain at Perpetual Trust to oversee the wind
down of Perpetual Cash Management.
Trustees
Executors v. Perpetual Trust – High Court (3.08.12)
12.022