$155,000 raised to investigate possible SCF legal action

The investigation into whether the action can go ahead will be funded by $155,000 raised from around 710 investors.

A whip-around of holders of South Canterbury Finance preference shares has raised more than $150,000, which will fund an investigation into whether or not legal action can be taken to try to get compensation.

The $155,000 raised is more than organisers had initially expected from the out-of-pocket holders of the preference shares, who got nothing of South Canterbury Finance's $1.7 billion taxpayer bailout.

The possible defendants in any claim to try and recoup money are not known, but a legal team has focused on the possibility of non-compliance by South Canterbury Finance with its continuous disclosure obligations.

A decision over the claim is expected by the end of June.

The investigation into whether the action can go ahead will be funded by $155,000 raised from around 710 investors. The investors contributed money after seven meetings around the country organised by Paraparaumu sharebroker Chris Lee. This time last week Lee was hoping to raise around $150,000.

At a meeting in Auckland on Monday, Lee detailed a string of instances where he claimed information about the company had not been communicated to the market.

"What I can tell you is that unquestionably we were robbed of our rights to accurate and timely information about the company and those that bought the shares ... they were playing with fool's gold."

Around 4000 investors had bought SCF preference shares, which at one point were worth a total of $120 million but tanked when the company hit the rocks.