17 May '99 Newsletter 1 - "The perpetrators no doubt hope this is the end of the matter — but we would like to see a different conclusion..."

10 Sept '99 Trustees First Reply to Meeting Request - "The right of unitholders to call for a meeting is in law exercisable against the manager."  And since the manager has resigned, you unitholders are fresh out of luck!...

25 Sept '99 Newsletter 2 - "I personally think it unusual and unfortunate that a unitholder meeting hasn’t been held long before now.  Unitholders are keen to have a frank discussion with the Manager and the Trustee regarding the demise of our trust..."

14 Dec '99 - Newsletter 3 - "You’re probably interested in assessing your chances of getting some of or all your money back.  Some of the Trust’s records are near the 7-year limit after which they could be destroyed.  The Serious Fraud Office has them secured right now"...

22 Dec '99 - The Final Word on a Unitholder Meeting? - "We continue to be of the opinion that there is currently no benefit to be obtained by holding a... meeting of unitholders... we will initiate a meeting... if it is in [your] interest..."  Now go away!!

29 March '00 - The Trustee's Opinion of an Inspector: "We are not currently aware of any grounds that support the appointment of any investigator, nor has there been any information presented to us..."  (Several hundred unitholder signatures don't count.)

Media Coverage of Flat Rock Forests Trust

Trust Topples, The Dominion, 31/1/98 - This notice from the newspaper, rather than a letter from either the Manager or the trustee, was the first indication most unitholders had that their investment was in fatal trouble...

Trustees Caught between a Rock and Debenture Holder, National Business Review, 13/2/98 - "...an analysis carried out in 1989 when the Flat Rock prospectus was issued warned of high fees, unspecified charges and potential conflicts of interest in the administration of the scheme..."

Flak Flies Over Flat Rock Trust Collapse, National Business Review, 27/2/98 - No conflicts!  No guarantees!  No money or trees left!  But no problem!

Flat Rock Forest Trust Receivership Raises Conflict of Interest Issue, The Independent, 1/4/98 - "I know it probably doesn't look good on paper..." but, oh, well.  Never mind...

Forest Trust Collapse Forces Entrepreneur to Liquidate, National Business Review, 9/4/98 - "...they seem like model immigrants but the Hatches have had to overcome many obstacles to make New Zealand their permanent home..."

Migrants Face Ruin after Forestry Ventures Fail, Weekend Herald, 11/7/98 - "Now it seems we just paid half a million for residency status.  That's a bit too much." - Hsiuhua Lin.  Curiously, Taiwanese business investment migrants dropped from 650 in 95-96 to only 4 in 97 - 98.  (Perhaps other Taiwanese agreed with her?)

SFO 'Happy' Over Migrant Scheme Claims Manager, National Business Review, 17/7/98 - The investors who are not happy can always apply for a job with the Serious Fraud Office.  Then they could be happy, too...

Flat Rock Collapse Flattens Creditors, The Independent, 11/11/98 - Bear in mind that the last set of publicly available accounts were NEVER audited...

Only Fraud Office Can Get Forest Investors' Money Back, National Business Review, 13/5/99 - "The Trustee... has sent a letter to unitholders outlining losses and telling them its involvement is at an end..."

Lack of Tower Premium Surprises Some Novices, The Mail, 07/10/99 - "A group of Flat Rock Forest investors is refusing to be deterred from the pursuit of those parties who promoted, managed and supervised this astonishingly unsuccessful venture..."

Forest Investors Seek Class Action, Sunday Star-Times, 17/10/99 - "Perpetual Trust General Manager Corporate Trust Rod Templeton said... there was little the trustee could do to help..."  We disagree.

Merger with the Aussies?  The Sooner the Better!, The Mail, 14/10/99 (?) - "In a letter received from the trustee last week, the claim was made that the trustee had always acted in the best interests of the investors.  If a 100% lost was the outcome, what would the result have been if the trustees were not involved?"

Ernslaw One Harvests the Manawatu Forest, Wellington Today, 27/01/00 - The tree this worker is hard at work on once belonged to Flat Rock Forests Trust.  I'd rather still have the tree than whatever we supposedly got in its place...

Migration Consultants' Chairman Barred, The Dominion, 11/03/00 - Mr Besley, who has spoken out on schemes that rip-off would-be migrants, reportedly said that a group of consultants opposed registration so they could maintain an "exclusive club" where they received concessions from the Immigration Service...

Unit Trusts: Misconduct and Mismanagement, Chartered Accounts Journal, 09/00 - "Suggestions of misconduct and mismanagement in the operation of a unit trust led the High Court to order appointment of inspectors to inquire into the Trust's operations."

Flat Rock Forests Battle, Christchurch Press, 21/01/02 - "Flat Rock Forests remains a scar on our corporate face, which will not heal..."

Law Society Member Guilty on Three Counts of Fraud - A leading tax expert and lawyer prosecuted by the Serious Fraud Office was found guilty yesterday of three fraud charges relating to a forestry trust.  Name suppression lapsed for Donald Hugh Simcock when Judge Nicola Mathers delivered her verdict in the Auckland District Court...

High Road to Disgrace - The Harvard graduate's path to disgrace began in 1992, when he became a director of the company managing Flat Rock Forests Trust.  The trust, which as its name implies invested in forests, collapsed in 1998, vaporising between $10 million and $14 million of investors' dollars.  But, before the investments began to fall apart, Simcock had set up financial structures that channelled money into his hands...

Related News

Migrants Arrive Via the High Seas, Evening Post, 07/12/93 - "To qualify as business investment migrants the family invested $500,000 through the New Zealand Development Trust Fund..."

Bite-Sized IT Projects Are Best in NZ Environment, National Business Review, 9/4/98 - "Individual IT projects should, if possible, be small and manageable - lean and mean..."

Timber Quality Upgrades Guarantee Future Markets, National Business Review, 17/7/98 - "A well-managed radiata forest can produce over 700 tonnes of useable wood per hectare in 28 years and show a compound return of around 9% per annum."

Jury System Changes for Fraud Cases Suggsted, The Dominion, 10/12/98 - SFO director David Bradshaw says the length of complicated fraud trials is a serious problem...

Travelling Life No Handicap, Contact, 18/2/99 - Cody Hatch has had only two years of formal education.  That hasn't stopped the 17 year old Texas-born Wellingtonian being accepted at Canterbury University and winning a scholarship..."

Fraud Office Needs Its Wider Powers for Success, The Dominion, 24/2/99 - Serious fraud is in excess of $500,000, is complex, and is of public interest.  (And they get the easy cases out of the way first.)

Logging Online, Computerworld New Zealand, 27/03/00 - With this software, the Internet can be used to track timber inventory (making life easier for future unitholders?)...

SFO Boss Threatens to Resign The Evening Post, 24/11/00 - "Serious Fraud Office director David Bradshaw ... will consider resigning if a parliamentary select committee persists in requesting legal documents from his office."

Flawed Justice New Zealand Herald, 10/05/02 - We have a court system in serious need of repair.  The legal domain seems not only incomprehensible but to bear little relation to everyday realities.  Indeed, so flawed is the system that the Law Commission says it's debatable whether the principle of justice for all is being achieved...

Land Title Change Creates Concern Stuff, 30/12/02 - "Anyone can fill out a transfer form, represent what they can claim is your signature, and transfer your house, as simple as that.  I'm astounded that it's been allowed to happen.  This is potentially worse than a leaky house.  This is no house..."

100% Conviction Rate for 2002 www.nzherald.co.nz, 4/01/03 - former SFO prosecutor, Dan Gardiner, who worked under both Bradshaw and his more colourful predecessor, the policeman-turned-lawyer Chas Sturt, believes "quite strongly" in the SFO and the effectiveness of the systems it employs to investigate and prosecute...

Government Gives Con Men Key to Auckland The Independent, 30/04/03 "...criminals needn't risk robbing banks or petrol stations anymore.  Fraud pays more and there's little risk of being prosecuted..."

Chilling Findings on Company Fraud New Zealand Herald, 12/7/03 - "...just under half of New Zealand businesses are thought to suffer from [fraud], and it is expected to get worse..."

Rich Fraudsters Get off Lightly - SFO www.nzherald.co.nz 7/10/04 - "... there remains in some areas an approach towards white-collar offending that makes the fight against fraud and corruption particularly difficult and encourages white-collar criminals to deny responsibility for their actions for as long as possible, with minimal adverse consequences."

You may wish to visit the Forestry Trust Table of Contents to read how a unit trust went bust.  Or the Topics Index which offers a different approach to lots of topics - among them poisonous insects, eating dogs, what's addictive, training versus teaching, tornados, unusual flying machines, humour, wearable computers, IQ tests, health, Y chromosomes, share options, New Jersey's positive side, oddities, ageing, burial alternatives, capital punishment, affairs, poverty, McCarthyism, the most beautiful city in the world, neverending work and more...