18 Dec 2012

Settlement reached over Credit Sails

12:18 pm on 18 December 2012

More than 3000 investors in Credit Sails, a failed financial product, will have 85% of their investment returned to them in a settlement worth $60 million.

The Commerce Commission has reached an out of court settlement with five companies that marketed the product which failed in 2008.

Forsyth Barr, Forsyth Barr Group, Credit Agricole, Credit Sail and Calyon Hong Kong agreed to create a $60 million fund to return to investors.

The commission estimates the total loss for those eligible for a share of the fund is about $70 million.

Chair Mark Berry said Credit Sails were marketed in a way that is likely to have breached the Fair Trading Act.

He said representations that Credit Sails was credit protected was deceptive and they were highly complex products that should not have been sold to the average investor.

The companies involved have not admitted liability.