FMA welcomes High Court decision on CBL

The Financial Markets Authority has welcomed the High Court's latest decision on CBL Corp.

The Financial Markets Authority (FMA) welcomed the High Court’s decision last week to dismiss the application to strike out its claim against the executor of the estate of former CBL Corporation (CBLC) director, Alistair Hutchison.

CBLC was listed on the New Zealand and Australian stock markets before a series of financial and regulatory issues led to its collapse and eventual liquidation in 2019.

The FMA’s claim related to the alleged failure by CBLC, two of its former directors and its chief financial officer, to disclose related party interests in a series of interrelated transactions — known as the Samoa Transaction — in CBLC’s product disclosure statement (PDS) upon listing in October 2015.

The FMA also alleges false and misleading statements in the PDS as to CBL Insurance Limited’s solvency position and the stated purpose of the IPO.

Hutchison died in December 2021, however the FMA’s civil claim in the IPO proceeding continues against the executor of his estate.

Following Hutchison’s death, the FMA is no longer seeking pecuniary penalties against the estate and now seeks declarations of contravention only.

“The FMA considers that it is in the public interest to continue the IPO proceeding against the estate given Mr Hutchison’s central involvement in the Samoa Transaction,” the FMA said.

“The High Court agreed that this does not amount to an abuse of process and that a fair trial is possible,” it said.

The FMA’s trial relating to the IPO is scheduled to take place in April 2026.

The FMA continues to seek pecuniary penalties against CBLC (in liquidation), Peter Harris (former managing director and chief executive), and Carden Mulholland (the former chief financial officer).

The FMA also discontinued its claim in the continuous disclosure proceeding against the estate of Hutchison.