January 21, 2015
Tuwharetoa writes off misspent money
Central North Island iwi Ngati Tuwharetoa has decided it is not worth taking action against trustees who lost more than $10 million in treaty settlement money.
In its latest annual report the Tuwharetoa Settlement Trust reported income of $1.96 million for the 2014 financial year.
That represented an 11 percent return on equity, which increased by $1.6 million to $17.7m.
Chair Dylan Tahau says the recovery and re-structure of the Trust's finances is for the most part complete, and it can now report what it considers to be the reasons behind the significant value loss in the Trust's equity post-settlement.
The trust started with capital of $66m from Tuwharetoa’s share of the Central North Island forestry settlement.
However, the initial trustees didn’t seem to realise that $29 million had to be passed on to hapu groups.
They also lost $9 million in investments and distributed a further $11 million in grants or spent it on administration, leaving just $16 million in the kitty by June 2013.
The bad investments included more than $2 million to a geothermal venture which was already in financial trouble, a $556,000 loan to a dilapidated Tokaanu Hotel connected with the trust manager who approved the loan, and bailing out a failed tribal land development by paying $10.3 million to buy back loans on land that was worth less than $6.4 million.
Mr Tahau says despite the losses, trustees believe there is little to be gained for either the hapu or iwi in pursuing the matters any further, and it’s time to move on.
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