LPF BACKED CBL CLASS ACTION MOVES AHEAD FOLLOWING FMA ANNOUNCEMENT
Media release: 18 December 2019
The LPF backed CBL Cass Action has today confirmed it continues to receive registrations to join its legal action against the directors of CBL and the company, with additional institutional shareholders representing 3.75 million shares joining the CBL Class Action.
CBL Class Action Claim Committee Chair, Andrew Bascand said
“This takes the total signups to the CBL Class Action to over 50 per cent of eligible shareholders.”
The FMA yesterday launched civil proceedings against CBL Corporation and its directors under the Financial Markets Conduct (FMC) Act.
“Based on the FMA’s announcement yesterday (and subject to seeing their proceedings), they do not appear to be seeking compensation for shareholders. Their focus is more on establishing that the defendants have breached their duties and for pecuniary penalties (similar to fines),” said Mr Bascand. “The regulator obviously believes, as do we, that both CBL Corporation and its directors ought to be held to account and in a sense, it looks like their action and ours may be complementary”.
He adds “The CBL Class Action is about seeking meaningful financial compensation for shareholders who have suffered significant losses. The FMA’s proceedings address wider public interest and regulatory concerns under the FMC Act, and are separate to the CBL Class Action.
“It is important shareholders understand the FMA claim is unlikely to directly provide compensation for individual investors. For that to happen, the only realistic option for shareholders, is to join a class action.”
“CBL had a market capitalisation of $747m when it collapsed in 2018, and represents one of the largest corporate failures in New Zealand’s history. It is essential that the full range of legal issues and remedies are properly explored to hold those responsible to account and to seek compensation for shareholders,” said Mr Bascand.