CLASS ACTION FILES WITH SERIOUS ALLEGATIONS MADE AGAINST CBL DIRECTORS
Media release: 1 November 2019
The Statement of Claim filed in the Wellington High Court by the CBL Class Action Committee against the former directors of failed insurance company CBL Corporation (CBL) includes serious allegations of misleading statements in IPO documents, breaches of continuous disclosure obligations and insider trading.
The CBL Class Action is being led by major shareholders Harbour and Argo Investments Limited. It is seeking compensation for the significant financial losses suffered by shareholders as a result of the company’s collapse in 2018.
Andrew Bascand, Chair of CBL Class Action Claim Committee said the Statement of Claim clearly outlines the allegations against CBL and the former directors.
“The claim alleges the directors of CBL are responsible for misleading statements in the IPO documents that, at the time the company listed on the NZX and ASX, it had adequate financial reserves to meet its insurance obligations. The claim also alleges that directors are responsible for the company failing to update the market in the period after the IPO with material information about CBL’s financial position.”
“The insider trading allegations in the Statement of Claim allege that directors Peter Harris and Alistair Hutchinson, through companies controlled by them, sold shares in CBL while they were in possession of material information relating to CBL that they knew was not available to the market generally.”
Mr Bascand adds “Shareholders globally lost hundreds of millions of dollars when CBL collapsed. The directors must be held to account for their actions and shareholders compensated for their losses.”
“Since launching the CBL Class Action earlier this month, we have received hundreds of registrations, including both institutional investors and out of pocket mum and dad shareholders keen to join the claim.”
“We believe legal action is the only way investors in CBL can get any money back,” he said.
Prominent NZ litigation funding firm LPF Group is backing the CBL Class Action.
Shareholders who acquired CBL shares in the IPO or subsequently and either sold them at a loss or still held them when the company failed in 2018 are eligible to join the claim.
Shareholders can register for the claim via www.cblclassaction.co.nz.