Inside Money: In the murk of South Canterbury

It's all quite murky. Photo / Thinkstock

Opinion

I like the email titled "Re: Can we use the garbage in the S&P June 2008 SCF report re sector risk, via the Guarantee, to force consistent NBDT disclosure in future?".

It's just one of the gems included in the list of South Canterbury Finance (SCF) documents released by the Reserve Bank this week.

And from the very first document dated October 22, 2008, there's a consistent sceptical undertone emanating from government officials in regards to claims from SCF.

After a visit to SCF HQ in May 2009, Toby Fiennes, Reserve Bank head of prudential supervision, noted in an email: "It's all quite murky and ultimately dependent on Hubbard making things good in the event of problems."

Which pretty much summed up the whole SCF story.

In contrast to some of the mad conspiracy theories being peddled by the 'Hubbard Support Team' the thread of the Reserve Bank documents portrays a group of people genuinely trying to find their way through the murk rather than assassinate a character.

Of course, any decent conspiracy theorist will tell you 'that's how they meant it to look'. But I don't think there's a genius - evil or otherwise - capable of directing such a fiasco.

Nonetheless, as taxpayers who stumped up for this mess, we do deserve further clarification on a few points.

I'm just as confused as Grant Spencer, deputy governor of the Reserve Bank, responding to news that the government guarantee will now extend to "non eligible investors such as foreigners, deposits over $1 million and related party deposits" backdated to all payouts since Mutual Finance fell over.

Spencer incredulously notes "so the govt will now pay out ineligible investors from previous failures?"