Huo Raymond: Illegal Contracts (Unlawful Limitation on Regulators’ Powers) Amendment Bill — First Reading 
Text is incorporated into the Bound Volume 
Huo Raymond: Illegal Contracts (Unlawful Limitation on Regulators’ Powers) Amendment Bill — First Reading 
[Sitting date: 25 July 2012. Volume:682;Page:3940. Text is incorporated into the Bound Volume.] 
RAYMOND HUO (Labour) 
: 
 It is a great pleasure to take a call to support the Hon Lianne Dalziel’s member’s bill the Illegal Contracts (Unlawful Limitation on Regulators’ Powers) Amendment Bill. Actually it reminds me of the good old days when Ms Dalziel chaired the Commerce Committee of which I was a member. Ms Dalziel was a good chair. Many have acknowledged that she was a good Minister and will be a Minister again in 2014. 
I would like also to acknowledge another former member of the Commerce Committee the Hon John Boscawen and thank him for his support of this important bill. Mr Boscawen has obviously some unfinished business with regard to this important bill. In his speech to the ING Frozen Funds Group Trust in Napier in March 2010 he said he would be working hard to convince his four other ACT colleagues to also support this bill to its first reading. I am not quite sure what is on the mind of the current ACT member the Hon John Banks nor am I sure whether Mr Boscawen’s position has any influence on the current ACT Party. 
I would like also to thank the Frozen Funds Group Trust. Going back to the days of Commerce Committee of the 49th Parliament the interest of its members in this particular issue was heightened with every new issue of their newsletter. Although the settlement the members of the group received from ING was far short of their expectations like Mr Boscawen has said the settlement may never have happened had it not been for their dedicated commitment to that task and in Mr Boscawen’s words “the military style nation-wide organisation” with more than a dozen branches throughout New Zealand. 
Much has been reported in the media of individuals facing financial ruin as a result of an investment decision in those finance companies. For those largely mum and dad investors a lack of knowledge about the nature of the risk they had been exposed to was one of the main factors. From the perspective of the finance companies I agree that in some instances the losses incurred have resulted from a dramatic change in the world markets and also a fall in property values which honest directors could not reasonably foresee. But the media reports are never short of examples of the lack of integrity in those finance companies and in the sector. Mismanagement inadequate disclosure hidden and excessive commissions for financial advisers and in some cases blatant fraud etc. were all contributing factors. On the other hand inadequate regulation and the failure to enforce that regulation have also been vital contributing factors. 
Therefore the purpose of this bill is to seek justice for everyone who invested in the two frozen funds and to increase protection for future investors. The bill amends the Illegal Contracts Act 1970 to extend the coverage of that Act to make it unlawful to limit the power of regulators such as the Commerce Commission to award a remedy or distribute the proceeds of any settlement or court order to any individual. The issue arose from the ING settlement where investors with money caught up in those funds were forced to sign away their rights from gaining any benefit from someone else taking action against ING including the regulator. I have no problem with the company making a settlement conditional on not proceeding with a civil course of action but this case was being investigated by the Commerce Commission at the time and the Commerce Commission was included in the release. Allowing such a provision to stand would effectively prevent the Commerce Commission from fulfilling its role of upholding rules that are designed to protect investors. So the bill does have a retrospective aspect whereby they are found to be in breach of their legal responsibilities to their investors. 
As a matter of public policy and of protecting the interests of the investor I commend the bill to the House.