Blue Chip boss nets $25m share windfall

…money would be "in an offshore account by now". The only way to find out where the money had gone, including the $25m share money, was to get Bryers in the witness box and ask him. "The liquidator has the power to do that under the Companies Act. I don't know why that hasn't been done." Bryers hung up when the Herald on Sunday called on Friday and did not respond to emailed questions. Liquidator Jeff Meltzer could not be reached.

The New Zealand Herald
May 17, 2009

Blue Chip boss nets $25m share windfall
Jane Phare

Blue Chip co-founder Mark Bryers earned more than $25 million from selling shares in one of his companies before the group collapsed last year, leaving some investors facing the loss of their homes.

Bryers' annual accounts filed this month show his company, Northern Crest Investments (formerly Blue Chip Financial Solutions), was deeply in debt and losing millions of dollars when he offloaded the shares that he beneficially owned.

In February last year, after 19 Blue Chip-related companies went into liquidation leaving thousands of investors $80m out of pocket, Bryers indicated $25m might become available from his own property developments.

He has kept up that line with Blue Chip liquidator Jeff Meltzer over the past year but there has been no sign of any money.

The 2007-2008 accounts, filed with the ASX (Australian Securities Commission), show that while Meltzer and his team immersed themselves in Blue Chip documents, Northern Crest Investments ended its financial year in debt, with losses of $125.4m over the 15 months ending March 31 last year.

Bryers offloaded more than 15 million Northern Crest shares between February and July 2007, earning him $25.84m.

He used another 13.7 million shares as security for a loan with Australian stockbroking firm Opes Prime, which went into liquidation in March this year.

Its main banker, ANZ (owed $827m by Opes) took control of those shares, the ownership of which Bryers is now disputing, according to the Northern Crest report.

The report does not specify Bryers' income from all his share dividends but it states he is "a major beneficial shareholder" and received dividends during the 15 months.

Bryers earned a salary of $486,000 a year as the company's executive director before he resigned in February 2007. He was reappointed in October that year. He was paid a further $288,500 in consulting fees in the 14 months to March last year.

This February Bryers announced plans to relist Northern Crest on the ASX after being suspended for a year.

That caused the Companies Office to start trying to liquidate Northern Crest on the basis it was insolvent, an action Bryers will fight in court next month.

Bryers also faces 60 charges under the Companies Act and this month Blue Chip's liquidators will apply to the High Court to take legal action against key Blue Chip executives and directors, including Bryers.

He also faces several bankruptcy proceedings, but he continues to live in a luxury apartment in Sydney and last month holidayed at the Hilton Hotel in Denarau Island, Fiji.

Despite Northern Crest's debt, Bryers' report to shareholders says the company is expecting to make a pre-tax profit of $4.13m next year. And last week Bryers announced the appointment of Australian accountant Marc Wilson as an independent director and chairman of the board.

A release on the ASX website described Wilson as a senior director of WWP Accounting Group, a Canberra-based accountancy and business services firm.

The release said he served on several existing boards, including one company which provides consultancy and recruitment services for the Australian Government.

The announcement led one former Blue Chip executive to speculate that Wilson "hasn't heard of Mark Bryers before".

It was "a joke" that with "serious criminal charges" against Bryers, he could still persuade people to work for him, the executive said.

Bryers has gone to some lengths to reinvent himself in Australia. His personal website in Australia makes no mention of Blue Chip, describing him only as the owner and manager of Northern Crest Investments. He lists his specialties as property investment, financial planning, merchant banking and accounting.

Last month the final part of the Blue Chip group went into voluntary liquidation, owing $20m in unpaid tax. Blue Chip Financial Solutions (NZ)'s sole shareholder is Northern Crest Investments. It is believed to be a holding company for more than 80 subsidiary companies, with no assets.

Auckland barrister Paul Dale, acting for Blue Chip investors in a six-week High Court trial, said there had been no offer of any kind from Bryers.

Worse, he believed that Bryers stood to gain in underwriter's fees from three Auckland developments he sold - Icon in Emily Place, the Turner Waverley apartments and St Martin's Lane on Symonds St. Those fees could be up to $15m for each development, said.

Dale also suspected the Northern Crest share money would be "in an offshore account by now". The only way to find out where the money had gone, including the $25m share money, was to get Bryers in the witness box and ask him. "The liquidator has the power to do that under the Companies Act. I don't know why that hasn't been done."

Bryers hung up when the Herald on Sunday called on Friday and did not respond to emailed questions. Liquidator Jeff Meltzer could not be reached.

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10572803&pnum=0


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