Sunday, March 27, 2005

Who wants to be a developer...ANYONE!

So lets introduce you to Paul Hewitt, developer [oh and director of several other failed companies - as we found out later and never divulged to us - See my tip at the bottom of this post] . When my wife and I first met Paul (at the offices of LJ Hooker in Khandallah) we thought he seemed like a nice guy. Somewhat quiet but he seemed to know what he was doing and we asked lots of questions about previous properties that he had built and how many staff he employed - sensible stuff. What we didn't expect were the barefaced lies which were all verified by the Realtor. I'll give you an example.

Q. "So, how many people do you employ?"
A. " Oh, about 10 people, some chippies, jibbers and the like."

Q. "Will there be any problems with completing on time; we want to be in by Christmas [2002]?"
A. "No problem. You can put a penalty clause in the contract so if we don't finish, you get the house cheaper."

And so on.
Let me deal with the first one. He employs nobody. The whole job is handed over to sub-contractors. Now this is fine if you use a regular crew that you trust. He didn't. He would employ anyone and everyone; if they could hold a hammer, they were in. If they knew what a hammer looked like, but had never held one, they were in. If they had a distant cousin that had once held a hammer, they were in......You get the picture?

Want to check someone out? Go to the New Zealand Companies Office.
Click on Search the Register and choose Director Search. Pop in the surname of the person and change the drop down to Current and Former Directors. You'll be amazed how many times some people can "resign" from a company just before it goes bankrupt and so avoid going onto the banned directors list......GGGGRRRRRRRRR. That makes me mad. Our pal had three previous companies in liquidation. Oh, by the way, some people use their middle names and first name in any order to avoid detection....make sure you know all the initials....

Sunday, March 20, 2005

Financial Crisis?

Now don't get me wrong, I love living in New Zealand. The people are great and the lifestyle everything you could want. There are just, as in every society, some bad apples as it were.

New Zealand is doing everything it can to gain credibility with the rest of the world for crime prevention, healthcare, and corporate governance. There was a survey published this week that showed NZ as one of the best places to live in the world - specifically Auckland and Wellington. I'd agree of course. Those canny Swiss ranked at the top but then they've got all the gold......

Anyway, back to my story. I should just mention that all of the people and companies that I've mentioned so far did nothing illegal. In fact, they all acted with the full support of the law. It is the law that is wrong. It looks after those with the cash to protect themselves and doesn't allow the wronged to obtain fair justice. I mentioned Lombard Finance last time. Well, they followed the letter of the law in my case and acted within its guidelines. However, if you were to ask me whether I thought they acted in the spirit of the law, HELL NO! But more of that next time....

Let me tell you about another interesting story in yesterdays paper. It concerns finance companies, which of course includes Lombard, and talks about the incredible risks that ordinary Mums & Dads are taking with these companies. How so? Well, each time you lend these guys money (which is what you are doing when you buy a first/second ranking debenture) they lend it out to someone else. Now, when you lend to a bank, there are strict rules and guidelines covering credit and liquidity; with a finance company, they can pretty much do as they like.....and they do. Check out this story for a great bit of background about the NZ industry - the one about the risks was called "The rogue elephant that won't go away" by Bernard Hickey and it was in the Dominion Post this Saturday 19th March - not on-line yet but you will be able to get it here soon.

The NZ property market has been going Gung Ho for a bit and finance companies have been lending by the truckful into this area. When the bubble bursts, and it will for the simple reason that they always do, someone is going to get burnt and who do you think that someone will be? I'll tell you who it won't be: the directors of the finance companies. It will be the Mums & Dads who lent money to these somewhat shady outfits and it'll be their families that suffer.

Some of these companies are run extremely well. There are two in fact that are just so good they should be banks - they have strict compliance and guidelines and are cautious in their approach. Unfortunately, the rest are mostly cowboys or opportunists making a quick buck and riding the wave. Boy, am I glad I don't have money to's good being that I've lost so much money...grrrrrrr. Time for a little lay down before I begin the rant and the rest of this sorry tale.

Thursday, March 17, 2005

Planes, Trains & Automobiles

So here I am. Standing on this patch of dirt on the hill overlooking the beautiful capital city of New Zealand, Wellington. I can see the Interisland Ferry (The Arahura) and the Fast Cattermaran (the Lynx) as they sail serenely between the North and South Islands (see above). I can also see the airport and the 737s that fly overhead on their final approach as well as the edge of the motorway taking people into the centre of town. This is for me I said.

Standing there, surrounded by the sound of Cicadas as they chirp and scream into the warm evening air "this is for me!" I say. I am in the middle of the bush. There are houses around me but well hidden behind native Pohutukawa. I could be a million miles from civilisation and I make a decision that is going to cost me dear. I can still hear the words of the slimy real estate agent "Jeremy" as he drones on about "this would be the view from the garage"..."this is where the front room would be"...and on and on. It was mid March 2002 and my new beginning in this fabulous country is about to be destroyed by the antics of one incompetent property developer, a young and stupid realtor and, towards the end of this sorry saga, a finance company with no compassion or respect for the rights of an individual and his family.

The lost money I can deal with. It is the pain and suffering that I put my family through in this venture that is almost more than I can bear. Our first 2 1/2 years in this country became one long nightmare from that day forward and I have no-one to blame but myself.....If you are thinking of building a home here, you'd be best advised to read on as I tell my story.

The developer was a guy named Paul Hewitt, the agent worked for a realtor called LJ Hooker and the finance company were Lombard Finance. I shall introduce them all in time......

Tuesday, March 15, 2005

Caveat Emptor

As I've said before, it takes a lot to get me rattled. Just to push that point, I don't get road rage, I don't fight, I've never been arrested; I occasionally shout at the television but only when England are playing rugby [Aside: For those of your reading this in the comfort of your homes in cold Blighty, the line that "we are still the World Champs", no longer works and invokes pity and usually a couple of jokes about Johnny Wilkinson taking it up the Gary].

Now, enough about what I don't get mad about and lets get to the stuff that does make me spew. Unfairness or injustice. Pretty simple huh? Now, don't get me wrong as injustice is not common despite what you might think. People do get arrested for crime - granted, they might not serve a long sentence and even get home detention, but the system works pretty well, most of the time......

What I'm talking about is the blatant disregard by certain individuals of not just the law but for their fellow human beings. They consider themselves above the law and hold it in contempt. They are the dangerous ones. They are the people that are not caught as they prey on the system and are like shadows. My story involves one such character, a real estate company and a well known New Zealand Finance Company with questionable business ethics. Over the next few months, or however long it takes me to get to the point, I will not just tell you about these people, I will publish some of the correspondence that I got from these cowboys.......

And so to the story. It all began in March of 2002 when I saw this little patch of earth that I thought could be mine..........

This is the view that captivated me Posted by Hello