RSL firm hopeful

Press, 22 July 1988, Page 15

RSL firm hopeful

PA Rotorua The receivers of RSL Heritage Finance, of Rotorua, are unable to say whether all investors will have their money returned in full, with interest.

But early indications are that the money is safe as the company’s loans exceed depositors’ funds by more than $300,000. Heritage, 77 per cent-owned by RSL Holdings, of Auckland, has outstanding loans totalling SI.IM while investors have contributed $794,661 in funds.

Mr John Olphert, the solicitor acting for the receiver, Mr Peter O’Connell, said yesterday if all the loans were repaid in full the likelihood was the depositors would get their money back.

However, there was no way the receiver could give that assurance.

Depositors who are repaid may have to wait for their money as Heritage Finance has loans on terms of up to two years. Heritage’s problems began last week when RSL Holdings came under public scrutiny after revelations about questionable lending practices. RSL Holdings is now the subject of a Justice Department inquiry. In response to the publicity surrounding its parent company, Heritage Finance suspended taking deposits till RSL’s position was clarified.

It also made two requests for interim funding from RSL to meet immediate de-

mauds for repayment of call deposits. However, RSL, which is the guarantor for all deposits made through Heritage Finance, dishonoured the first request, for $50,000, after originally agreeing to supply the funds and then refused a second request. Because the company could not meet demands for on call deposits this placed it in breach of its trust deed with the New Zealand Guardian Trust, according to Heritage Finance’s general manager, Mr Peter Jones. “It was then our duty to contact the Guardian Trust advising of our position, and this we did with the result being a receiver was called in,” Mr Jones said.