JBL head admits mismanagement

Press, Volume CXII, Issue 32966, 12 July 1972, Page 1

JBL head admits mismanagement

(New Zealand Press Association) AUCKLAND, July 11. The former head of the failed JBL empire, Mr J. E. Jeffs, today accepted there had been “gross financial mismanagement'’ of the affairs of the group in New Zealand, as stated by the Government receiver, Mr D. L. Hazard.

In an interview, Mr Jeffs said he believed that from November last year at least half a dozen very short-term loans for a total of "something in the millions” had been raised.

He described this as "a contributing cause” of the collapse, but said the main reason was losses in clothing and construction and capital commitments for the fishing fleet. Asked whether the loss on sale of clothing stocks had been about $600,000, he said this was “not too far away.” Asked about his statement that he would go to London to work and raise money to make good losses suffered in the crash, Mr Jeffs said the money could not be directed to individual sectors of the business, but would go into the over-all JBL pool. “We can only work to resurrect the company,” he said. “But it will take at least two years before we have any money to start distributing.” JBL, he said, must ultimately receive money from the Australian companies, even if it were necessary to sell them. “Doing best” In England he was confident he had the ability—“l will be doing my best”—to make money in property to pay off creditors and investors in New Zealand. He felt that in spite of British currency restrictions he would be able to have any such money transferred to New Zealand and was sure “the press will get to know” of any payments made. Why had JBL continued to raise money from the public when it was obvious it was in serious difficulties with liquidity? “We did not anticipate this happening,” he said. Referring to the appointment of a receiver, he said he was still satisfied the group could have recovered, and

but for the $700,000 involved he did not think the A.N.Z. Bank would have moved. Asked about reports that large sums in cash were held in private Jeffs brothers companies not covered by the receivership, Mr Jeffs said: “This is impossible.” 15-year trusts He said that the family trusts, which had been in existence for 15 years, were under the receiver. How was he able to fly around the world when he was so short of cash? “I flew here from Australia on a $l2O excursion. The

fares for my family and 1 to return to England are being advanced by a merchant bank." He would leave on August j 3 after meetings locally. Simplicity sought What lessons learned from! the JBL crash would he apply to his venture in England? “I have learned to avoid a complex operation. I want a simple operation, low in staff, but high in calibre and with small overheads, but I still believe in geographical diversification.” His brothers, Vaughan and Kevin Jeffs, although staying in New Zealand and Australia respectively, would be shareholders. There had been a staff of thousands in the JBL operation and “I just could not know what was going on down the line.” “In the early days I kept everything pigeon-holed. At the end we were turning! over $1 million a week. It is impossible to know everything that is going on.” Home in Sydney Was it not a mistake, then, to have made his home in Sydney three years ago instead of keeping a close eye on the affairs of the New Zealand companies? Mr Jeffs felt this was not necessarily so. He said the overseas companies could still rescue the New Zealand situation. But he did feel JBL would have kept going satisfactorily in New Zealand if he had stayed. Mr Jeffs said he had received no abuse about the collapse since his return to New Zealand, only a number of offers of money. “People have been fantastic.”