deloitte finds 400m opes assets

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    Deloitte finds $400m Opes assets

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    Scott Murdoch | April 05, 2008

    THE receivers of Opes Prime have discovered up to $440 million worth of unexpected assets through account irregularities in the main operation, and in the books of the connected investment company Hawkswood Investments used by the collapsed stockbroker's directors.

    Deloitte partner Sal Algeri revealed last night that $200-300 million (at book value) had been found in the "irregular" accounts of some Opes Prime customers as the receiver's forensic accounting firm worked its way through the stockbroker's intricate internal financial records.

    The discovery came on top of $130 million to $140 million (book value) worth of assets held in Hawkswood that consisted mainly of shares in listed and unlisted companies. It is believed part of the portfolio was made up of luxury cars and property that had been funded through loans given by Hawkswood.

    The connected company of Opes Prime had been established by the three directors of the main stockbroking company -- Laurie Emini, Julian Smith and Anthony Blumberg. "There is a recovery that needs to be made from irregularities in some accounts; we think there is $200 million to $300 million in that parcel," Mr Algeri said. "There are other assets in Hawkswood Investments. We think there's assets of $130 million to $140 million at book value.

    "These assets are available in the pool and the issue is how much can be received for them."

    Mr Algeri would not give further details on the nature of the irregularities in the accounts, which are believed to be connected to direct customers of Opes Prime.

    "There are irregularities in the accounts ... in certain customers' accounts," he said.

    The assets in Hawkswood are believed to have been funded through lending to buy shares, and the property is understood to involve residential and commercial sites. The list of victims connected to Opes is growing, with a number of companies telling the ASX yesterday that their capital positions were unclear. Mr Algeri said that for creditors the situation was improving, but it was still uncertain whether all of the losses would be recouped. "The difficulty that we have is determining what all the assets are worth," he said.

    "It is difficult to relay that back as to whether there will be substantial or negligible returns. We are sticking to our view that ... creditors will get something back. The difficulty is to predict the exact amount of the dividend and when it will be made."

    The final size of the lending by the three main secured creditors -- ANZ, Merrill Lynch and Dresdner Bank -- should be finalised early next week.

    The selldown of stocks seized by ANZ and Merrill Lynch is continuing, with the remainder of the selling to be done on behalf of ANZ.

    Global investment bank Merrill has finalised its stock selldown and is believed to have covered the secured loan of $500 million that it made to Opes.

    Rob Stewart, a Hong Kong spokesman for the bank, said the bank had "no exposure" to Opes as the loan had now been covered.

    Merrill is understood to be still holding a parcel of illiquid stock that it has been forced to keep in its portfolio.

    Meanwhile, the prospect of fresh legal evidence against Opes began with court cases in Perth due to start shortly. Hugh McLernon, CEO of litigation funder IMF, said it was preparing several cases after it was approached by aggrieved shareholders.

    The action would be separate to the court actions currently on foot in Sydney and Melbourne.

    Mr McLernon said those who had approached the firm were investors who did not realise control of the shares had been effectively rendered to Opes Prime under the complex lending agreements.

    "The people we are working with, they are prospectors who have good reasonable sized interests in Australian mining companies," Mr McLernon said.
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