Judge Allows 426 ANZ Clients to Pursue Claims Over Ross Asset Management Losses
On August 26, 2019, a Wellington courtroom filled with 426 people heard a judge announce that they could proceed with a lawsuit against ANZ Bank. The individuals had entrusted their savings to David Ross, who operated Ross Asset Management and oversaw roughly half a billion dollars for about nine hundred clients.
Rather than investing the funds, Ross transferred money from client accounts into an operating account to cover his own expenses and then falsified records to show strong returns. When clients attempted to withdraw their money, they discovered the funds were missing. Ross was later sentenced to ten years in prison. The collective loss suffered by the investors totals $115 million, and none of that amount has been recovered.
The group now seeks compensation from ANZ, the bank that held the accounts used by Ross. The High Court decision does not find ANZ liable; it merely grants the investors permission to pursue their claim.
The investors contend that ANZ ignored clear warning signs and failed to stop Ross from moving money between accounts in an improper manner. They assert that the bank spent three years resisting disclosure of internal documents, only relenting after the Financial Markets Authority successfully sued ANZ and compelled the release of those files. According to the investors, the released documents reveal mismanagement of the Ross Asset Management accounts.
John Strahl, who leads the investor group, noted that the members were unaware of the underlying court battle over the documents until the judge’s ruling was issued. He described the situation as a secret conflict that the investors did not realize had already begun.
The alleged misconduct occurred between 2007 and 2012, a period during which ANZ administered the accounts, recorded the transfers, and retained the relevant paperwork. The central question now is whether a judge or jury will determine that ANZ bears responsibility for the losses. The case is not focused on David Ross, who remains incarcerated and unable to satisfy any financial obligation; instead, it examines the role of the institution that held the money.
The investors argue that ANZ owed a duty of care and breached it, while the bank will likely defend itself by characterizing Ross’s fraud as sophisticated and claiming it too was a victim. The Financial Markets Authority’s earlier proceeding already established, as a legal finding, that ANZ’s handling of the accounts was bungled.
The plaintiffs must now demonstrate a direct link between that mismanagement and their $115 million loss. Only the 426 investors who joined the specific claim are covered by the ruling; other victims of the scheme are not part of this litigation but are watching the outcome. A successful verdict could encourage additional actions against the bank.
ANZ has yet to file its full response, but it is expected to argue that the fraud was complex and that the bank suffered as well. The investors will maintain that ANZ possessed the necessary controls and obligation to detect and halt the improper transfers.
For the time being, the plaintiffs have secured a court date and the procedural green light to advance their case. While the ruling does not restore the missing funds, it represents a significant step forward compared with their position just days earlier.
