By Ross Kelly
Law firm Slater and Gordon will not start legal action against financial planners who sold clients Westpoint products for about another month, and it will target the bigger dealer groups first.
“It’s a slow process, and what we’re doing is taking client information and documents and grouping them, looking at the insurance and asset position of the planners and the licence holders,” said Slater and Gordon lawyer and co-ordinator of the actions Rob Lees.
According to Lees, the law firm at present is looking to possibly represent 800 clients and the number is consistently growing towards an earlier estimate of 2,000.
“Unfortunately, there’s a lot of people making a lot of statements against many parties like the planning groups, Westpoint’s directors and Westpoint’s auditors, so it is very difficult for the mums and dads at home trying to work out what they should be doing with this,” Lees said.
He said Slater and Gordon would not wait until most client complaints had been processed before launching its first test case.
“Otherwise we’d never get them done. We’ll be looking at the large groups first.”
Lees also ruled out Slater and Gordon taking any direct action against Westpoint auditor KPMG, which last week was accused of malpractice by a former Westpoint director.
Richard Beck, a key capital raiser for Westpoint, said he warned KPMG his company was pooling funds from separate developments into a “common pot”.
He also warned them that he thought Westpoint’s Ann Street Mezzanine fund, one of the first to collapse, was raising more money from investors than it had disclosed.
KPMG has dismissed the claims as baseless.
“We don’t have access to the audit books and we don’t have details of audit contracts,” Lees said.
“So we don’t know specifically what they were required to audit and what they did and didn’t know — certainly the liquidators would be in a better position at this time. So KPMG is one we’re looking at, but a lot more information needs to come to hand.”
