'Super investor' accused of encouraging price-fixing by Commerce Commission

[jenny_pt]

Article from Stuff:

The Commerce Commission has filed High Court proceedings against "super investor" Ron Hoy Fong's company Ronovation, for alleged price fixing in Auckland's residential real estate market.

Ronovation, trading as Ronovationz, was set up in April 2009 and conducted business advising members on how to acquire and improve investment properties in Auckland. By March 2018, Ronovation had more than 400 paid members.

Read Stuff's full story here......

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Forum Link to Ron Hoy Fong News

[donna]

The commission and Ronovation have entered into a settlement to resolve the proceedings, and a penalty hearing will be scheduled in due course.

Any guesses what the 'penalty' will be? It's not going to hurt Ron financially I'm sure his tax planning and asset protection is all bedded down. So a penalty against the limited liability company that's probably got next to no assets - what could the CC go for and get?



cheers,

Donna

[elguapo]

Any guesses what the 'penalty' will be? It's not going to hurt Ron financially I'm sure his tax planning and asset protection is all bedded down. So a penalty against the limited liability company that's probably got next to no assets - what could the CC go for and get?

cheers,

Donna

They can go after him as an individual and levy fines in the tens of thousands.

From 2021 it will be a criminal offense that can result in 7 years jail, and a maximum $500k fine.

[donna]

I wonder how the mentors today share their tips on how to purchase under value. Maybe they collect everyone's phone at the door so they're sure they're not being recorded. They'd have to watch their every word for it could come back to bite them.

cheers,

Donna

[Perry]

Looks like another comical commission cloud cuckoo case.

[GLin]

I wonder how the mentors today share their tips on how to purchase under value. Maybe they collect everyone's phone at the door so they're sure they're not being recorded. They'd have to watch their every word for it could come back to bite them.

cheers,

Donna

Basically if a mentor knows two students are going after the same property. He or she cannot interfere and cause cartel behaviour, ie get these two students to drive down the price, or prevent them from bidding against each other to drive up the price.

Obviously Ron got pinged because of this, and funny it was actually what the students wanted. The students wanted a fair rule that prevented students from bidding against each other, so that they don't drive up each others prices.

Ron implemented the rule without consulting lawyers who know a bit about comcom (who would know right?), and paid a stupid price.

As usual, Comcom goes straight for the throat without any prior warning.

I personally met a surviving dentist who lost his dentist business partner through suicide due to Comcom investigation a decade ago. The surviving dentist spent at least a hundred grand to clear his name. The dead one received zero justice.

[elguapo]

Obviously Ron got pinged because of this, and funny it was actually what the students wanted. The students wanted a fair rule that prevented students from bidding against each other, so that they don't drive up each others prices.

I'm amazed! People wanting to create a cartel to advantage themselves. Perhaps they should have consulted a property professional who understood the business and could have mentored them away from breaking the law.

Ron implemented the rule without consulting lawyers who know a bit about comcom (who would know right?), and paid a stupid price.

Cartel behavior has been illegal for many decades and is widely understood. Someone promoting themselves as a professional in the property business should have understood the implications.

As usual, Comcom goes straight for the throat without any prior warning.

I think you will find the enforcement of law works that way. If you were on the receiving end of this, you would be screaming for 'justice' in a heartbeat.

I personally met a surviving dentist who lost his dentist business partner through suicide due to Comcom investigation a decade ago. The surviving dentist spent at least a hundred grand to clear his name. The dead one received zero justice.

What 'justice' did the one who killed himself miss out on exactly?

[jenny_pt]

Property investment advice firm Ronovation, run by Auckland "super investor" Ron Hoy Fong, has agreed to pay a $400,000 fine for price fixing.

Read more....

[Perry]

Property investment advice firm Ronovation, run by Auckland "super investor" Ron Hoy Fong, has agreed to pay a $400,000 fine for price fixing.

Ouch! Not something covered by insurance, no doubt.

Mind you, 400 'members' at circa 20K each leaves a bit of change left over.

[DaveW]

Small change. Sell a rental?
Just as well it was no wrongdoing in motherland China.. 25 years of hard labour.

[Davo36]

Small change. Sell a rental?
Just as well it was no wrongdoing in motherland China.. 25 years of hard labour.

And a kidney.

[jack2016]

they don't want your labour. they have kids in africa to do that. just harvest all the organs.

https://www.wsj.com/articles/the-nightmare-of-human-organ-harvesting-in-china-11549411056

[Don't believe the Hype]

Isn't stopping HNZ from competing with Kiwibuild to buy available sections no different to what Ron has been pinged for?

https://www.stuff.co.nz/national/politics/115120445/kiwibuild-and-hnz-competed-over-same-land-and-homes

[Davo36]

Hmmm, both part of the government. So one buyer really.