ING fronts up to angry Auckland investors

Financial adviser Michael Beuvink trades blows with ING chief executive Helen Troup at the Ellerslie Convention Centre. Photo / Greg Bowker

Accusations of lies, fraud and mis-selling were fired by investors at ING and its shareholder ANZ Bank yesterday as hundreds of investors caught in ING's frozen structured credit funds met in Auckland.

About 400 people turned up to the meeting at the Ellerslie Convention Centre, one of 10 held around the country this week as ING fronts up to investors in its Diversified Yield Fund and Regular Income Fund to present its settlement offer.

ING chief executive Helen Troup said there had been a lot of anger and emotion expressed over the way ING had handled the situation.

But Troup's attempt to make a connection with investors incited some to mock her speech calling it "a load of rubbish", others said they felt "deceived" and accused ING of using their money to invest in risky assets. Mediator Brian Edwards had to step in. "We can run this in a civilised way or in an unruly way," he said.

He called on investors to be patient and promised they would have a chance to have their say.

ING is offering to buy back units in the two funds paying 60c per unit for the DYF fund and 62c per unit for the RIF fund. Investors can either take the cash up front or keep it in an ANZ call account with an 8.3 per cent interest rate per year for the next five years. But if investors accept the offer they also have to sign a release which waives their right to make any claims, or benefit from any legal action in relation to the funds.

Over 13,000 investors are thought to have ploughed their money into the two funds which were frozen by ING in March last year.

A female investor, one of the 2700 advised by the ANZ Bank, said she had closed a UDC term deposit and invested all of the money in the ING fund.

"I had saved over 20 years, I am bitterly disappointed by ANZ, their adviser and the advice I received."

ANZ spokesman John Body said the bank acknowledged that some of its advisers had given bad advice to some investors.

That was why ANZ had written to all its investors telling them they could make a complaint if they believed they had been mis-sold the funds.

But the woman said she had received nothing from the ANZ.

Body said investors should not have had all of their money put into the funds, those who had a low risk tolerance should only have had up to 25 per cent of their money invested.

A Frozen Funds Group investor, Andrew Davidson, questioned whether there had been any warnings given to ING New Zealand on the increased risk to CDOs before the funds were frozen.

Troup believed the company had not received any information from its international network and the company had never ignored any advice.

But financial adviser Michael Beuvink said a warning was made to ING's trustee company which is also part of the ING group.

Troup said that was a lie. Beuvink countered saying ING were liars because they had never given all the details of the CDOs to advisers.

Troup said the funds were not invested in junk bonds and it had always been transparent and open about investing in CDOs.

"We did not lie in our offer documents."

WHERE TO NEXT?

* Investors have until Monday, July 13 to decide on ING's proposal.
* Investors who went through the ANZ Bank have until July 31 to make a formal complaint.
* Investors who accept the offer should gain access to their money by August 28.
* Those who don't accept the offer will continue to own units in the funds.
* Investigations by the Commerce Commission are ongoing but won't be completed by the decision deadline.
* Complaints have also been made to the Securities Commission asking it to delay the offer until the Commerce Commission has ruled but the commission said yesterday it had no ability to stop the offer going ahead because the offer is not misleading or deceptive.