9 Nov 2013

Quality of financial prospectuses questioned

1:48 pm on 9 November 2013

Retired Supreme Court judge Sir Edmund Thomas says financial prospectuses are difficult to read and give potential investors little help in managing their money.

Sir Edmund says there was a miscarriage of justice in the case of four Lombard Finance directors convicted after the company collapsed in 2008, leaving debts of $111 million.

The case against the four men related to important information being omitted from a prospectus.

Sir Edmund says only 1% of the people who lost money with Lombard actually made their investments after the prospectus was issued and there is no evidence any of them actually read it.

He says prospectuses are long and complicated documents, and should be made easier to understand.