Pyne Gould is under further scrutiny after disclosures of more related-party loans and directors overriding staff concerns.
Last month, the High Court in Auckland appointed two independent observers to investigate the details of a $28 million loan made by Pyne Gould's Perpetual Cash Management Fund to another Pyne Gould entity, Torchlight Fund.
Perpetual Trust has agreed to wind up its mortgage fund and internalise its cash fund, thus ending any public investment it, which would remove the need for the the independent observers to remain.
But Justice Heath is not satisfied as yet, saying that even if the fund is internalised, the observers are still needed to investigate the original $28 million transaction.
He ordered the observers to remain, and gave Perpetual 10 days to file how it planned to wind up the mortgage fund and internalise the cash fund.
Meanwhile, the court has heard the fund made a $3.3 million loan to a company in which Pyne Gould director Michael Tinkler was a director, at about the same time as it made the loan to Torchlight.
The loan was apparently made without any security or paperwork.
The court also heard that a $3.7 million loan made to Wildgrass did not meet the company's security requirements.
It was rejected by lending officers, but later overuled by Perpetual's directors.
Both loans have since been repaid.
