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05/04/19
06:28
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Originally posted by Patong1:
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You are wrong. The client funds were held on trust and segregated, but Halifax AU used them for company funding, which is against the law and they will need to answer for that. The issues were isolated to Australia. Their audited financials weren't even accurate. The updated reports and meeting minutes are on the ferrierhodgson website www.ferrierhodgson.com.au (search for Halifax). NZ never mixed company and client funds. As Halifax AU handled Treasury, they were the administrators of all client funds. The issue, and the reason why you are caught up with this is the way in which AU administered client funds. In the administrators report view the section on "What Should have happened" vs How they administered funds. As far as NZ is concerned the administrator's investigations can be summarised as follows: The statutory investigation from Ferrier Hodgson, the administrators of Halifax NZ is summarised as follows: Our investigations have determined that Halifax NZ may have been insolvent from at least 23 November 2018, being the date that Halifax AU was placed in Administration. Based on our preliminary investigations, we have not identified any breaches of the Act by the Director or Former Directors. Our preliminary conclusion as to the solvency of Halifax NZ Having regard to the above analysis, it is our preliminary view that the Company: Traded profitably; Maintained a positive net asset position to meet the terms of its derivatives issuer licence; and Was unlikely to have been insolvent for any material time prior to 23 November 2018, being the date of appointment of Administrators to Halifax AU. Based on our review of the books and records received, we are of the opinion that the Company’s books and records were maintained to 27 November 2018 and in accordance with Section 194 of the Act. The Administrators’ preliminary investigations do not reveal any evidence of falsification of records. The Administrators’ preliminary investigations do not reveal any evidence of any false or misleading statements. Based on our initial review, we have not identified any potential voidable transactions that may be recoverable by a liquidator. Our preliminary investigations have not revealed any unfair preference payments. Based on the books and records in our possession we have not identified any transactions which would constitute unfair loans to the Company. From our preliminary investigations, we have not identified any offences by Halifax NZ’s Director that require reporting to the FMA pursuant to Section 239AI of the Act. Held and controlled is not strictly speaking correct. Client funds were administered by Halifax AU. The problem is how the funds were administered, not where they were held. Also it was disclosed that Halifax AU was a counterparty to Halifax NZ in the PDS. For NZ Clients. Your funds were supposed to go into the Halifax NZ trust account and then to Interactive Brokers, but the problem is that AU ran a float on IB so accounts could get credited more quickly or withdrawals could get processed more quickly, so you funded your account to Halifax NZ trust account for $ABC then on IB, Halifax AU was running a float so rather than transfer funds to IB from Halifax NZ trust they would transfer funds from the float held on IB to your sub account...need a diagram to explain this. What I think we said is that the Halifax NZ IB account was under Halifax NZ, not Halifax AU, which it was. If treasury administered the funds in/funds out process correctly and there was a direct trace of funds coming in and funds then going to IB in the correct amounts, likely Halifax NZ IB client would be ring fenced from this. But because they didn't administer the funds the way they were supposed to, it has resulted in this.The thing is AU broke the rules and used client funds for company purposes, which is the issue and they'll will be held to account for this. Timeline. Can't say for sure but 6-12 months is the optimistic view.A lot depends on how the distribution will work, which needs to be decided by the courts in both AU and NZ At best you may loss 5% to 20% of funds held on the TWS platform But they could be tied up for yrs and courst costs will dilute your returns also.
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Patong
The actual page number is page 28- titled trading process for IB client in the creditors report published on 12th March. It states that trades start off with Halifax - they don't. The trades happen directly in the IB platform between trader and IB