Adviser banned under new laws

Neville Cant. Photo / Supplied

The Securities Commission has for the first time banned a financial adviser, after he was found guilty of theft and forgery.

Laws introduced in February 2008 gave the commission the power to take action over disclosure and made it a criminal offence for advisers not to disclose certain information.

Those who hold back information, provide a misleading, deceptive or confusing disclosure statement or advertisement or contravene an order by the commission, can face fines of up to $300,000.

They can also be banned for up to 10 years if they are convicted of criminal disclosure offences or have consistently contravened the law, or have been banned overseas.

Yesterday the commission banned Timaru adviser Neville Ian Cant for five years.

Cant was last week sentenced to 14 months' imprisonment and ordered to pay $100,000 in reparation to a Timaru couple after he was convicted of crimes involving theft by a person in a special relationship and two charges of fraud relating to forged letters sent to them in an attempt to hide the fact he had not invested their money as requested. Those charges were brought by police.

Cant and his companies Investment Management and Combined Financial Services were also found guilty of offering and allotting securities without a prospectus and investment statement for a scheme called "The Gables Proportionate Ownership Scheme". The venture was supposed to be for an elite school for girls planned for a location near Auckland.

Cant approached investors in 2006 with a proposal to contribute towards the $5 million venture but signed up subscriptions before investors had received the offer documents.

Cant was fined $80,000 for the two Securities Act charges and his companies were also each fined $28,000 for the charges which were brought by the Ministry of Economic Development on referral from the commission.

A spokesman for the commission said the ban was an automatic result of Cant's convictions under the Crimes Act but would not have been possible without the law change that was introduced in 2008. That law change was introduced to tighten the rules around financial advisers after the finance company collapses.

The ban includes stopping Cant from acting as an employee of an investment advisory firm or broker in any way that would allow him to give advice, receive investment money or investment property from a member of the public.

The convictions also stop him from being a director or manager for the next five years.

Cant took $100,000 from a Timaru couple who thought they were investing in a commercial property development. But the money was transferred into Cant's business account in the name of Aoraki Property Investments.

The couple had expected Cant to invest the money and they would receive interest of 4 per cent. The loss of the money had forced them to sell their home.

Cant had his membership temporarily suspended from the Institute of Financial Advisers in December last year. Yesterday IFA president Lyn McMorran said Cant's membership would be reviewed again by the association's disciplinary committee.

New laws setting a minimum qualification and ethics code for investment advisers are to come into force by December. But McMorran doubted they would stop situations like Cant's from occurring.

"There will always be people in every industry that will do things they shouldn't do."

McMorran said the changes meant there was now a way of stopping people who broke the law from practising.

Cant's LinkedIn profile says he had a diploma in financial planning and life underwriting from Massey University and was part of the Business Mentors NZ group.

Neville Cant

* 56 years old.

* Has diploma in financial planning and life underwriting from Massey University.

* On a temporary suspension as a member of the Institute of Financial Advisers.

* At present a director of nine companies.