An open letter to Bill Jeffries

Last updated 05:00 16/05/2014

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Opinion & Analysis


OPINION: Dear Bill,

Good old Radio New Zealand doesn't usually incite me to violence, but the other morning I felt like throwing things at my wireless when I heard you being not very sorry over the Lombard Finance collapse.

As I listened to you explain in practiced political tones why you would not be apologising following your conviction for misleading investors, I wondered how many of those Mums and Dads were suppressing similar urges to launch projectiles at their radios.

I'm sorry to say it, Bill, but you came across as arrogant - like a prideful member of the establishment out of touch with the ordinary man. Was that how it was done in the 80s when you were in Parliament?

I understand that you feel vindicated, after the Supreme Court reduced you and your fellow directors' sentences, and that you believe you can contribute a lot out there on the marae when you do your 400 hours' community service - although it's intriguing marae governance is something you feel you should be involved with.

But perhaps you missed investor Tristan Hooker, who on the same radio station said that it was a promotional video featuring yourself and the other directors which persuaded her to invest in Lombard a matter of weeks before the company went into receivership.

She's finding it hard to swallow your claims that you behaved reasonably given what you knew at the time.

Because all was not rosy at Lombard, was it Bill? Your fellow former politician and director Doug Graham wrote in an email the month before the misleading prospectus came out that the company was ''sailing very close to the wind'', and that unless a constellation of stars aligned it ran the risk of running out of cash. Four months later it went belly up.

That to most people would be a matter for regret. Of course you've said you're sorry investors lost the better part of $100 million. Aren't we all?

But the way you tell the story, the Kiwi finance company collapses were all to do with those big bad American investment banks playing fast and loose with the global financial system, and very little to do with those in charge of running the firms.

Curious, because it wasn't the impression I got sitting on the press bench at the High Court as a seemingly endless stream of finance company litigation played out.

Low quality and often related-party loans on property developments of dubious value, coupled with desperately tight liquidity, were hallmarks of a sector which was caught starkers when the tide went out.

Once one fell - and Bridgecorp, Nathans Finance and Five Star Consumer Finance had all gone in the months before you signed off on the offending Lombard prospectus - they pretty much toppled like dominoes.

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Hooker says she teaches her children to apologise and to try to put things right when they err. That's called taking responsibility for your actions. Your answer when you were asked if you'd taken enough personal responsibility over Lombard - that it was "for others to judge"- shows you haven't quite grasped the concept.

You're very big on New Zealand learning lessons from the finance company sector collapse. It's hard to learn lessons if you don't own what happened, Bill.

Disingenuous is the polite term for what you're being.

Yours sincerely,

A journalist who covered far too many finance company collapses.

- * Maria Slade is editor of Unlimited magazine.

- Unlimited

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