ACFI Creditors Support Group
Avondale College Foundation Investors
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Questions & Answers
We have received a number of questions from creditors eager to know what is happening to their funds. We are sure than many creditors would like to have the same information so we will post these questions on this site.
As the answers are confirmed by PPB or the Creditors Committee, we will post the answers here and let you know by email. In the meantime, if you have questions you would like answered, please feel free to email them or post them at the bottom right of this page.
ANSWERS TO QUESTIONS UPDATED ON 27 JUNE 2011
1. When is it anticipated that the administration with PPB will end and the final dividend be paid?
The final asset realisations are scheduled to occur in 2015. If there is an opportunity to realise these assets sooner then PPB will explore such an opportunity.
2. The original estimate of total returns was said to be in the vicinity of 70%. The third and fourth payments have been mere dribbles. According to the original projection by PPB there are 2 further payments, in 2011 and 2013. Is the 70% still a possibility or are there just crumbs to come?
At this stage PPB are still projecting a total payment within the original range estimated. It is likely to be at the lower end of the range, i.e. close to 70 cents in the dollar. This will be subject to any further deterioration in the asset values that may occur. PPB are informing the Committee as and when any significant matters arise in this regard.
3. Did any directors, former directors or relatives of ACF or ACFI have loans at the time of the collapse? Have any of these loans not been repaid or been reduced and by how much and why? If it is the case that any directors or former directors (or related entities, family members) had loans on what basis were these loans given, what security was required? Were the conditions outlined in the Investment Guidelines of the Fund?
Of the director and former director related loans, one set (relating to three directors/former directors) has not been repaid in full. The Committee is aware of the details of this, settlement of which was confidential and full details cannot be disclosed to the general body of creditors. The loss suffered was in the region of $1.5m.
3. What has happened to the 'staff' of ACFI? Surely they would have been aware of what was occuring during 2008. Can members of the ACFI Board be held accountable for not notifying members of problems which were happening early in 2008?
Other than the directors, there was only 1 staff member of ACFI. The question of pursuing Directors was explored in the Administrators report to creditors of 24 November 2008.
3. Apart from the original investments such as Rubicon which caused ACFI to collapse, have some of the other remaining investments gone sour since PPB took over?
There has been further losses suffered from a deterioration in some of the investments, however, PPB still estimate that the total dividends paid will be within the range originally estimated, albeit at the lower end of the scale. This estimate is of course subject to any further losses that may be suffered. PPB are informing the Committee as and when any significant matters arise in this regard.
4. Is PPB using up more than expected in administration costs and what have they charged so far?
PPB Advisory’s fees for the Deed Administration total approximately $540,000 to date
5. Is it true that someone let the cat out of the bag and a large depositor emptied their account just prior to ACFI going into receivership? As only the Directors knew, would that mean that one or more of them dudded the rest of us?
PPB has investigated this as part of the administration and they do believe that there is no evidence that this occurred.
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I refer to question & answer 3 on the list. If a director and former director had loans and it has not been repaid in full and the loss suffered was in the region of $1.5m, why is not the director and former directors being required to pay their loans. All the creditors are having to suffer financial loss because of this as well. It does not seem right to me that they get away with this!!?? Why. Surely they were secured to something that can be realised for cash. Please answer this question. Someone must know???
Did any directors, former directors or relatives of ACF or ACFI have loans at the time of the collapse? Have any of these loans not been repaid or been reduced and by how much and why? If it is the case that any directors or former directors (or related entities, family members) had loans on what basis were these loans given, what security was required? Were the conditions outlined in the Investment Guidelines of the Fund?
I refer to the original document given to us by PPB dated 24 November 2008.
The diagram on page 23 indicates the realisation of some investments in June and Sept 2011. Why can we not expect a payout in 2011 from these investments when they mature?
The same diagram indicates a large and final realisation of investments in 2013. Why is this payout now postponed to 2015? On page 24 of the same document is another diagram showing the realisation of property funds, a significant maturity occuring in June 2012 and a lesser one in 2013. Why are there no projected payouts from these investments?
I do not want these questions directed at PPB. To do so would only give them cause to further milk the funds. But surely the previous directors of ACI have sufficient knowledge to answer these 3 questions. Surely they would know what properties would mature in 2012 and 2013 and why they are not factored into a payout. And surely they would know of the big investment originally scheduled to mature in 2013 and now postponed to 2015.
Would it be possible to have a break down of how the investments were made up at the end of 2008? In particular, what percentage was in direct mortgages, shares, property funds etc? Also, how much was loaned to Directors and how much was loaned to parties connected to Directors (related businesses, family members etc)? Also, how many Directors of ACFI and of Avondale Foundation (and related entitites) had funds invested in ACFI at the time of the collapse? Additionally, how many SDA Division and Avondale College organisations had funds invested in ACFI at the time of the collapse? I image that this must have been a high number in light of the fact that the originally creditiors committee was heavily weighted with Avondale and church representatives.
Re Monica's query---I too wonder about the staff. They would have known and no doubt rearranged their own finances appropriately prior to the big crash. I was advised that there was one creditor living in Cooranbong who went around crowing that he pulled all his money out and had safely reinvested it at 6%. Now, how did he know to do that? I may be a little sceptical and extremely disappointed at ACFI, but who wouldn't be to see your life saivngs going down the gurgler.
In good faith I wanted to support a Christian organisation & instead of putting the money in banks or other organisations, I invested in ACFI hoping in good faith I will have some spending money for my retirement & see where it has taken me. Frustrated, disappointed & angry
Could you provide details of the amount that PPB has charged so far. Thanks
What has happened to the 'staff' of ACFI? Surely they would have been aware of what was occuring during 2008. Can members of the ACFI Board be held accountable for not notifying members of problems which were happening early in 2008?