BNZ recovery bid may backfire, says Franks

The BNZ's legal bid to recover money paid out after the Access Brokerage collapse may trigger unwelcome new sharemarket regulations, Act MP and securities law expert Stephen Franks says.

On Monday, BNZ and Access liquidator Ferrier Hodgson said they were taking sharemarket operator New Zealand Exchange and accountants Deloitte Touche Tohmatsu to the High Court at Auckland seeking up to $5.2 million in damages.

BNZ is claiming the NZX and Deloitte were negligent in their oversight of Access's books before the low-cost sharebroker failed in September last year, leaving a $4.8 million shortfall in client funds.

BNZ met $4.3 million of the shortfall, and NZX paid the balance.

Franks said it was disappointing when parties involved in such incidents went looking for redress.

"If you hold auditors liable for trying to pick up fraud, they keep, quite naturally, trying to goldplate all the protection systems and they insist on procedures and checks that irritate hundreds of honest people," he said.

"I hope the court is mindful of the inevitable consequences - higher sharemarket listing fees, more red tape and more barriers to entry, particularly for smaller businesses."

BNZ expects the case will be heard early next year. Access former managing director Peter Marshall faces 15 charges as a result of a Serious Fraud Office investigation.