The Chair of the Financial Markets Authority Eastablishment Board, Simon Botherway, now has no choice but to step aside pending the outcome of the Ombudsman’s inquiry into the mangament of his potential conflicts of interest in placing Allan and Jean Hubbard into statutory managment.
The public cannot understand how the Securities Commission took this step reportedly on the basis of a single anonymous complaint, timed shortly after Mr Hubbard transferred the bulk of his remaing assets into SCF to protect investors.
Further, the Ombudsman must widen the terms of its inquiry to include questions around any potential or perceived conflicts of interest around Mr Botherway’s long standing business relationships with Mr George Kerr, Director of Torchlight Fund, one of the primary beneficiaries of the taxpayer funded bailout of South Canterbury Finance depositors.
These associations are reportedly of long standing and reportedly included at Spicers Portfolio Management and at Brook Asset Management, as well as in relation to several other funds. Mr Kerr is also a Director of Pyne Gould Corporation, which has announced that it is seeking to set up a “heartland bank” centered on rural South Island lending.
It must be totally transparent that neither Mr Botherway nor any of his interests have any ongoing relationship whatsoever with this proposed new bank.
In short it is imperative that if wide ranging financial markets regulatory powers are to be concentrated in the hands of a single regulator, the holder of that office must be beyond reproach, with an impeccable record, and no possible or perceived conflicts of interest with former, current or potential business associates.
Mr Simon Botherway, who was John Key’s former Deputy at Bankers Trust, must now step aside from from the FMA Establishment Board Chair pending the outcome of a broadened Ombudsman’s inquiry.
Furrther, the Key Government cannot now clear the air on SCF withut a full and independant judical inquiry into the circumstances leading to its recievership and New Zealand’s largest investor bailout.