Property industry experts and investors have expressed shock and dismay that the Serious Fraud Office decided not to prosecute collapsed investment company Blue Chip.
Speaking on property specialist members-only website PropertyTalk, Manawatu based investor and property manager Aaron Clancy wondered how much tax payer money the Serious Fraud Office spent on the failed court case.
“Amazing. Hundreds of investors lose out and they still can’t prosecute,” Mr Clancy said.
Meta Group mortgage broker Mark Jurgeleit said it was bewildering Blue Chip’s actions were not considered criminal.
“I was a mortgage broker throughout this time and had a couple of approaches from Blue Chip. I was told that I didnt even have to meet the clients, just submit the lo-doc applications. I steered well clear, but it was obvious from these approaches and anecdotal evidence from other clients, that these schemes were blatantly misleading and dangerous,” Mr Jurgeleit said.
He explained the Blue Chip model had ponzi elements to its structure, selling over-priced apartments with high fee charges and weak guarantees for rental return.
“The scheme was unethical, immoral, predatory and misleading. It combined all the elements of the bubble perfectly; rising prices and rising confidence, easy credit with fewer questions asked and complex and compelling marketing strategies designed to make a very risky product look risk free.”
Other members pointed the fingers at investors for not doing their homework on loans that were misleading but according to the Serious Fraud Office, not illegal.
“One fact we do know is that they sold overpriced apartments - this is not a crime,” a commenter known as CJ said.
“Their marketing material probably made misleading statements but that was probably all backed up by 'independent' parties (ie valuers and rent assessors) - so again probably not a crime by Bluechip.”
Jazial Crossley
Fri, 29 Oct 2010
