Caught in the Caymans: a million dollar diocesan school for girls is at risk

An Auckland exclusive private school has more than $ 1 million compromised to a failed Cayman Islands fund manager now under investigation by the Serious Fraud Office.

Diocesan School for Girls, the nation’s richest private school for girls, noted in its latest accounts that its investment arm, the Heritage Foundation, had been aware of a “significant discrepancy” in the value of $ 881,354 it had invested in Penrich. Global Macro. Background.

READ MORE: The $ 2 Billion Question: New Zealand’s Richest Private Schools Revealed

Penrich, a fund manager targeting sophisticated investors, is based primarily in the Cayman Islands, with offices in London and Christchurch.

His weapons in all countries are now on sale, and in early April the Serious Fraud Office (SFO) announced that it was investigating him.

Another Diocesan-related entity, Doris Innes House Trust, disclosed in its 2019 accounts that it also had $ 327,759 with Penrich.

The Weekend Herald understands that more than $ 10 million of New Zealand investors’ money is in the fund and at risk of significant losses.

The amounts at risk in Diocesan represent about one-eighth of the total investments held by the school and the Doris Innes trust.

The Heritage Foundation helps manage donations and diocesan funds for capital expenditures at the school, while the Doris Innes House Trust offers scholarships to boarding students.

David Gibson, president of the Diocesan School Heritage Foundation, said in a written statement that there are “strong governance and investment protocols.”

Gibson said the school, “along with various investors,” awaited the outcome of the SFO and liquidator’s investigations.

Sue Hornblow, chairwoman of the Doris Innes trust board of directors, said she did not know if the trust would get some of her money back.

“I’d like to say yes, but I don’t know,” he said.

Hornblow directed additional inquiries to Angela Anderson, director of AMA Capital, who said she “managed the fund’s investments for us.”

Anderson, a registered financial advisor, a Dio elder and former president of the Heritage Foundation, said she hoped the SFO would identify and prosecute those responsible.

“I can’t believe that those who are in a position of trust abuse it like that,” he said.

Each year at the schools awards show, the Angela Anderson Cup is awarded to a senior for excellence in accounting.

Diocesan, in the central suburb of Epsom, has a roster of about 1,500 students and charges more than $ 23,000 a year in fees.

Heather McRae, diocesan director, declined to be interviewed by the Weekend Herald.

Red flags had been raised over Penrich a few years ago, with the Evergreen Retirement Plan saying in its 2015 annual report that its trustee had requested that it step down “due to the delay in providing audited accounts for the Penrich fund and disability of the auditor to verify the valuation of the underlying assets “.

The Penrich structure appears to have had an office managing the administration in New Zealand and another in Great Britain offering advice, while directing investments in various funds, the Macro Fund being the largest, registered in the notoriously secretive Cayman Islands.

The liquidator of Penrich Capital’s New Zealand arm, Kare Johnstone of McGrathNicol, said the company only handles administrative matters and not investor funds. She was unable to comment further due to the SFO investigation.

Penrich Capital UK’s accounts filed with the UK companies office said its Macro Fund “is the dominant source of income for the company” and has delivered “strong investment returns”.

The Cayman Islands court filings said the Macro Fund aimed to “generate capital appreciation, over time, regardless of prevailing market conditions” and sought to achieve returns in excess of 15 percent per year.

The Cayman Islands company office records do not record who ran the Macro Fund.