Settlement secures $67.5 million for Westpoint investors
In another win for Westpoint investors, the Australian Securities and Investments Commission (ASIC) has settled a compensation suit with KPMG and certain Westpoint Group company directors.
ASIC stated the settlement would result in the recovery of up to $67.5 million for the benefit of investors, which would become available through the liquidation process.
A payment of $57 million is to be made in the next 30 days, which will bring to an end the current Federal Court proceedings ASIC brought against KPMG and directors of Westpoint companies.
An additional $10.5 million is due to be paid to the liquidators of relevant companies, subject to confidential conditions.
According to ASIC chairman Tony D’Aloisio, the settlement will avoid the delays associated with conducting proceedings through to trial.
“A confidential commercial resolution is, because of the age and circumstances of the investors, the preferred resolution in a case such as this where litigation can take years,” he said.
This settlement will bring the total funds recovered to around $160 to $170 million, which falls short of the $388 million investors lost when the group collapsed in January 2006.
The recovered funds include the settlements with State Trustees Limited in excess of $25.5 million, $49.2 million obtained through the liquidation process (a figure that is expected to reach $56 million), and a further $22.5 million of returns that is expected from Westpoint companies not in liquidation.
It is expected that liquidators of the companies will apply to the Federal Court for directions on how funds are to be apportioned in the first quarter of the year.
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