Police seize records of investment group

Press, Volume CXII, Issue 32849, 24 February 1972, Page 14

Police seize records of investment group

The police in Auckland have acted on warrants empowering them to search the offices of the North American Investment Group of companies and take possession of the companies’ files, ledgers, and other documents.

The companies advertise that they have New Zealandwide offices and have promised investors a net return of 20 per cent on money invested in vending machines to sell sweets, perfume, chocolate, tampons, panty hose, nuts, toasted sandwiches, and other foods to the public.

Investors throughout New Zealand—who have sought the advice of the police in Auckland. Nelson, Christchurch, and other centres—have Invested a total of more than SIOO,OOO with the companies.

The investment manager for the group, Michael Montague Silver, of Auckland, is reported to be overseas. The whereabouts of the principal shareholder and director of several of the companies, Donald Leslie Brookes, also known as Brookes-Green, is not know’n. Christchurch investors in the North American Group became concerned when its office in Armagh Street failed to reopen on January 31. The| office was closed just before! Christinas, but a notice on the door said it would reopen on January 31.

Women investors

Investors in Christchurch some of them women, have put up to $6OOO each in a scheme under which the group promised to supply vending machines, sites to place them, products to self from them, and other servic-; ing items.

The investors signed contracts in which the group of companies promised to supply the machines. However, a clause said that the investor understood that the distributing companies were not responsible for any delay in delivery. The investor also agreed to a caluse which said the contract was a purchase order that could not be rescinded. Delays in deliveries of vending machines and troubles over sites, arranged by the companies, caused several investors concern.

The office in Armagh Street is that of North American Business Systems (Chch),

Ltd, which was registered as a private company. The address of the head office of the company is given as 400 Queen Street. Auckland. The capital is listed as $2OOO, with subscribers as Donald Leslie Brookes (1999 shares) and K. Hunt (1 share). Mr Brookes is named as director. The objects of the company are given as manufacturing and dealing in electric goods or machines. The landlord of the Armagh Street office has changed a lock on a door of the office and intends to take a lien on the furniture to recover rent owing. The lease under which the office was rented has also been breached. -

Mr K. Hunt, who ran the I office, lives on Cashmere Hills. He told an inquiring investor that he had not reopened the office because “payments were not coming through satisfactorily from the head office in Auckland." The head company, accordI ing to the sign on the window ; of the Christchurch office and i letterheads on stationery, is ' North American Business 'Systems (A’Asia), Ltd, a priivate company registered on ; August 24, 1970. Its address 1 is given as 400 Queen Street. The capital is $4OOO, with P. iW. Howard and D. L. Brookes subscribers (2000 shares each) and directors. The objects of the company are given as manufacturing and dealing in vending machines. equipment, etc.

Investors inquiring at 400 Queen Street have elicited no response. However, a Christchurch investor who visited Auckland last week, after seeing the police, found that the company was operating from an office in Armishaws Buildings, on the comer of Albert and Victoria Streets. There was no sign on the office, and no sign of Messrs Brookes and Silver.

A Mr Richard C. Owan, who addressed a meeting of prospective investors called by the company in Christchurch last year, was in the office. He assured the investor that the company would meet its commitments “if given time.” A spokesman for the Auckland police yesterday said that the search and possession warrants had been obtained on reasonable grounds for suspecting that the companies involved were breaking regulations under company and tax laws. He said that investors had redress under civil law. They could claim for money owing by the companies ana seek a winding-up order — which could lead to an investigation by the Official Assignee’s office.

Other companies

Other companies listed as members of the North American Group include Parfum Pacific (International), Ltd, a private company registered on May 14, 1970, with head office at 249 Hurstmere Road, Auckland. Capital is listed as $4OOO, with subscribers as D. L. Brookes and P. J. Harris (2000 shares each) and Mr Brookes as director. The purposes of the company are given as manufacturers’ agents. The Burbank Manufacturing Company, Ltd, is another private company registered in New Zealand, with head office at 400 Queen Street. D. L. Brookes is the major subscriber (3000 shares). The two others are P. K. King (500) and M. M. Sliver (500). D. L. Brookes is also a major shareholder in Modumatic Industries, Ltd, a private company with registered office at 400 Queen Street. Both these companies have the purpose of manufacturing and selling vending machines, etc. The list of advertised companies in the group also includes the Cleveland Coin International, U.S.A.; Lance Inc., U.S.A.; and Diversified Education and Research Corporation (F.S.), U.S.A. D. L. Brookes was connected with the British Coin Machines Company, Ltd, registered in New Zealand. This company was unsuccessful, and creditors are still trying to obtain claimed debts against it. The vending machine business—the selling of machines and sites—has recently proliferated in Christchurch with the registration of South Island Vending, Ltd, and Convex Marketing, Ltd, two private companies. Convex Marketing ($lOO capital) is the major shareholder in South Island Vending—and directors in South Island Vending had connections with the vending business through British Coin Machines and Industrial Dispensers, Ltd, a private company which apparently took over British Coin Machines.

Pamphlet issues

North American Business Systems, Ltd, informed a Nelson investor that Convex Marketing, Ltd, would supply her machines for her investment. Last week, she complained to the police because the machines had not been delivered. Mr Silver, in a cyclostyled pamphlet to prospective investors, promises that the investor will get the “first 20 per cent” of profit by "clockwork” cheques—the cheques being sent to the investor on the same date each month “with clockwork regularity.” Mr Silver said that he takes the second 20 per cent of profit and pays all expenses for servicing the vending machines, finding locations, installation, and so on. He said that the extra 5 per cent which he makes on all his “flexible syndicates” is given to the investor as a "Christmas bonus.”