NZ natural remedy investors seek cure

Roger Douglas. Photo / Mark Mitchell

Investors in a New Zealand company - which had a former Finance Minister as a director - have laid complaints with Australian authorities after allegedly losing tens of thousands of dollars.

Act MP Sir Roger Douglas was a director in natural medicines company NewZeal Corporation Ltd, the subject of shareholder complaints to the Australian Securities and Investments Commission and police.

Companies Office records show NewZeal was set up by New Zealander Patrick Wilson in 2007 and is registered in Auckland.

The business was to develop various drugs, including a natural substitute for ritalin, used to treat ADHD.

Sir Roger did not return phone calls. He resigned as a director in November 2009 and his daughter, Megan, resigned two weeks later.

Megan Douglas, a naturopath, yesterday said they resigned after it became apparent that no money was being used to develop the product.

"Money wasn't being put in to making it happen so we got out as quickly as we could, as soon as we felt that there was no supporting marketing budget for it. It was a bit disappointing, really."

Ms Douglas said neither she nor her father were shareholders or paid regularly and lost a considerable amount of money that way.

She was paid around $3000 for her research work over two years.

"I had worked for two years for no money. I put my invoice in for $120,000 because I worked for hundreds and hundreds of hours.

"It was very disappointing to many people, I think."

Ms Douglas said she felt guilty as her father had only joined the company to help her.

Several Australian shareholders who spoke to the Herald said they tried many times to get their money back but were flatly refused. They believed their money had been used to finance Mr Wilson's lavish lifestyle.

Queensland Senator Brett Mason invested A$150,000 ($193,000) in the company. The former director told the Courier Mail that he had formed a friendship with Mr Wilson, who is his neighbour.

"I knew him socially," he told the newspaper. "I trusted him and it appears that trust was very misplaced."

When the Herald contacted Mr Wilson in Queensland, a man who answered the phone said he would be away for a couple of days.

Mr Wilson is the brother of Frances Wilson, owner of luxury hotel Mollies, in Ponsonby.

Also a director for NewZeal, Ms Wilson said she had joined the board to provide assistance in such areas as marketing.

"NewZeal is a start-up, high risk business and investors who came on board were aware of the risks," she said in a statement.

Although one product - the natural ADHD medication - had failed, a second product was being worked on and was due to be ready for market in about three months, she said.

"I can understand why investors may have considered they may have lost money to this point [and] may be upset, but typically these types of businesses are high risk and do require time to get going if they are to succeed."

The Australian Securities and Investments Commission yesterday confirmed that several complaints had been received.

A spokeswoman for the commission said it was too early to say whether an investigation would be carried out.

What it's about
* Shareholders have laid complaints with Australian authorities about New Zealand company NewZeal Corporation.
* Act MP Sir Roger Douglas and his daughter were directors but resigned.
* New Zealander Patrick Wilson is a current director and now lives in Queensland.
* Shareholders, one of whom is an Australian senator, believe their money funded his lavish lifestyle.
* Patrick Wilson's sister Frances Wilson is also a director. She owns luxury Ponsonby hotel Mollies.