Scam victims seek full compensation

…the demands include a request for Green Acres to take full responsibility for Lapham's actions, asking for the return of the money paid to him and for loans for the purchases of the bogus businesses made through the company's financing arm, FBL Finance, to be nullified.

The New Zealand Herald
April 23, 2008

Scam victims seek full compensation
Lincoln Tan

The lawyers for defrauded franchisees of a Green Acres scam will be issuing a letter demanding full compensation for victims' losses, possibly today.

"The letter of demand to Green Acres is ready, and will be going out any time now," said Raymond Huo, one of the lawyers acting for the victims, mainly Chinese and Indian immigrants who paid between $21,000 and $25,000 for non-existent ironing businesses to Keith Lapham, the company's former area manager.

It is understood that the demands include a request for Green Acres to take full responsibility for Lapham's actions, asking for the return of the money paid to him and for loans for the purchases of the bogus businesses made through the company's financing arm, FBL Finance, to be nullified.

Failing that, the franchisees want Green Acres to meet all the incomes that had been contractually guaranteed by Lapham, dating back to the time of purchase of the individual businesses.

Franchise Watch, a group representing the defrauded franchisees, met on Sunday to sign off the letter.

A spokesman said if Green Acres did not agree to the demands, then other legal avenues would be explored.

He said gathering statements from nearly 200 people for the lawyers to prepare their case, and the letter, had been a "massive logistics exercise", and it was a "major accomplishment" just to have reached this stage.

One franchisee, Giri Kattel, said he felt the demands were fair, considering what many had gone through.

"Many of the victims have suffered huge losses and it is only fair that they get back the money they have paid in good faith," said Mr Kattel, who is still seeking employment. "We bought the business because of the good name of Green Acres, and the company will have to take responsibility of the actions of Lapham, who is one of their staff members."

However, Green Acres has maintained that Lapham was not an employee of the company, but operated as an independent business owner.

The company's chief executive Andrew Chisholm, in January described Lapham's actions as a "reasonably serious and elaborate fraud", but said it was carried out by an independent franchisee and not by an employee or the company itself.

Serious Fraud Office chief executive Grant Liddell said investigators were still in the process of analysing the files and that he expected investigations to take at least another two months.

"It must be noted that there are over 19,000 documents to assess and analyse."


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