Soaring Kiwis Ltd – Non-Compliance with the Companies Act: A Case Study

Soaring Kiwis LtdJohn Malcolm Carr is the sole director of this company and its board has failed to file its annual return with the Registrar of Companies. It was due in May 2015. This failure is a breach of Section 214 of the Companies Act 1993. Every director of a company commits an offence in failing to comply with s. 214 and is liable on conviction to the penalty set out in section 374(2) of the Act (see below).

Let’s see how the law works in this case …… in a study of non-compliance and enforcement issues. [Read more…]

Former sex expo firm – Eden Digital Ltd – owes $350,000 – NZ Herald 16 June 2012

The company that held the licence for a sex expo allegedly still owes creditors more than $350,000, according to its liquidator’s latest report.

In 2008 Auckland-based Eden Digital was given the licence to run the Erotica Lifestyle Expo – an event “targeted at adult consumers” which has been held in Auckland and some other North Island centres for more than a decade.

The event was often preceded by the Boobs on Bikes parade, which featured topless women riding on motorcycles.

But in November last year Eden Digital was placed into liquidation after its licence for the expo was cancelled by its shareholder CVC Group.

CVC is also the sole shareholder of Esprit Events, the new licence-holder for the expo.

After the cancellation, Eden Digital’s income was “decimated”, liquidator Grant Reynolds said.

According to a report Reynolds filed with the Companies Office this week, Eden Digital allegedly still owes creditors more than $350,000.

One preferential creditor had filed a claim for $171,792 and seven non-preferential unsecured creditors had filed claims totalling $183,901, the report said.

At the time of liquidation it was estimated the company owed $434,000.

A list of creditors when the company was first liquidated included Inland Revenue, ACC, ASB Showgrounds and Marquis Condoms.

According to Reynolds, Eden Digital was sold to a related party shortly before he was appointed and he is investigating this sale, as well as any possible voidable preferences.

A voidable preference is a payment of debt made before liquidation which a liquidator can apply to call back on the grounds it unfairly privileged some creditors over others.

Reynolds is also investigating any possible Companies Act breaches.

Pornography industry heavyweight Steve Crow is a former director of Eden Digital, according to Companies Office records. In 2010, Crow was banned from acting as a director for four years after the collapse of companies linked to him.

Source. Story by Hamish Fletcher. 16 June 2012


Eden Digital Ltd – update on liquidation and Erotica Lifestyles Expo licence transfer

Update on Inquiry into Funding of NZ Porn Industry: On 13th June 2012 the second Liquidator’s Report on Eden Digital Limited (In Liq) was issued (It was put into liquidation on 22/11/11 and was directed by American businessman John M Carr CPA from 23/04/08 to 13/09/11). [ Photo of John M Carr ]

The Report revealed that one preferential creditor – (the IRD) has filed a claim in liquidation for $171,792 [for unpaid GST & PAYE].  Based on the first (earlier) Liquidation Report, the company’s employees, who constitute another class of preferential creditors, are owed $20,000 in wages. The latest report shows that seven non-preferential (unsecured) creditors, have filed claims in liquidation for $183,901. This brings the total owed by Eden Digital Ltd to these creditors, to $355,693. An additional several thousands of dollars will probably be claimed by Grant Bruce Reynolds, the Liquidator, of Reynolds & Associates Ltd, (Insolvency Practitioners), for his fees and expenses, and these costs must be paid in advance of all other payments to preferential creditors.

It is unlikely that any of the unsecured creditors will receive anything after all the secured creditors are finally paid out. The latter include the shareholder CVC Group Ltd, directed by John M Carr CPA and holder of all 150,000 company shares in Eden Digital Ltd; Vision Rentals Ltd, Solutions Group Receivables, Konica Minolta Business Solutions and Harper Collins Publishers.

Eden Digital Ltd, which was incorporated on 23rd April 2008, held the licence for Erotica Lifestyles Expo until 16 September 2011 (as reported in the Waikato Times) – the day John M Carr CPA resigned as director of Eden Digital Ltd and appointed Raymond Sydney Corben Simpson of Mt Eden, Auckland, as its sole director. On that same day the Expo licence owner, CVC Group Ltd, directed by John M Carr, withdrew the licence from the licencee Eden Digital Ltd, also directed by John M Carr. (CVC Group Ltd owns Eden Digital Ltd and both have John M Carr as sole director).

Although Eden Digital Ltd was technically put into liquidation on “by special resolution of the shareholders”, under ‘the watch’ of Mr Raymond Simpson on 22nd November 2011; this action was necessitated as a result of a financial collapse that occurred under the sole ‘watch’/directorship of John M Carr.

It would appear that Eden Digital Ltd must have been trading whilst insolvent and had not been paying tax for many months – prior to Mr Simpson being appointed as director – a state of affairs that occurred under the directorship of John M Carr – [ Note again!: he was director from 23 April 2008  to 16 September 2011. More importantly he was sole director from 15 May 2010 to 13 September 2010].

Having abandoned the directorship of Eden Digital Ltd on 16 September 2011, Mr John M Carr’s next move was to incorporate the company Esprit Events Ltd, of which he is sole director, a company also owned by CVC Group Ltd. Esprit Events Ltd purchased the Erotica Lifestyles Expo licence from CVC Group Ltd, a company of which he (Carr) is also sole director. CVC Group Ltd wholly owns both Eden Digital Ltd and Esprit Events Ltd.

Eden Digital Ltd was the licensee of Erotica Expo Expo and the transfer of the licence to a related party, Esprit Events Ltd, could hardly be seen as a significant or complex financial transaction. Director John M Carr merely obtained the licence from himself and then gave it to back himself, then returned it to himself, to put it crudely. Such a ‘transaction’ did not require a large contingent of lawyers from Checketts McKay Law firm in Cromwell or a consignment of Adult Services handmaidens to effect the ‘complex’ financial ownership transmutation. It was not exactly the ‘sale of the century’.

Having now obtained the financial records of Eden Digital Ltd, Grant Bruce Reynolds, the Liquidator, has indicated that he will be focusing his investigation into Mr John M Carr’s activities as director: specifically on “any potential breaches under the Companies Act,” and on any possible voidable preferences”. He will also be “Reviewing the sale of the business [Erotica Lifestyles Expo/Eden Digital Ltd] to a related party [Esprit Events Ltd] pre liquidation including obtaining advice on the validity of the sale and whether or not adequate consideration was given by the Purchaser for the business.”

Among the 22 unsecured creditors of Eden Digital Ltd listed in the First Liquidation Report filed on 23 November 2011, are PJ Digital Ltd and the US-registered corporation Better Business Services, Inc.  [see note below] both owned and directed by John M Carr; NZX Media Ltd and Ezisoft Computer Systems Ltd, both directed by David Bruce Crow; ASB Showgrounds which has provided the venue for a number of successive Erotica Lifestyle Expos; IRD (penalties and interest for unpaid tax), and ACC (unpaid ACC levies).

Note: Better Business Services, Inc., also referred to as BBS Inc, was incorporated in San Antonio, Texas, on November 11th, 1983, and was authorised under Texas Charter number 67876000 to carry out defined business activities in Texas, including those carried out in a certified public accountancy practice (tax returns, bookkeeping, payroll etc). John M Carr CPA is director, president and registered agent of Better Business Services, Inc. an unsecured creditor of the NZ-registered company Eden Digital Ltd (In Liq). On 6th September 1984 under charter number P03291 BBS, Inc. was authorised to do similar business in Florida.


Expo claim ‘bollocks’  By Daniel Adams. 29 November 2011

Companies Office website:

Porn Kingdom asset sale to be questioned. National Business Review. 8 July 2009. By Lucy Craymer.

Boobs on Bikes returning: Porn King – Bay of Plenty Times

Defiant pornographer Steve Crow has vowed to bring Boobs on Bikes back to Tauranga despite council moves aimed at blocking the topless parade.


CVC Group Ltd, directed by John Malcolm Carr, owns the trademark for “Boobs on Bikes” and Stephen (Steve) Peter Crow, a banned company director who was fined $5000 in the North Shore District Court last year for breaching his four-year ban, is Carr’s “business partner”. Crow was fined plus ordered to pay court costs for being involved in the management of a porn company – Eden Digital Ltd (In Liq), wholly owned by CVC Group – while being a person prohibited from being a director.

Eden Digital Ltd (In Liq) which was incorporated in April 2008 to hold the license for Erotica Lifestyles Expo, an event promoted by the Boobs on Bikes event, was put into liquidation on 22 November 2011, with an estimated deficit (subject to the cost of liquidation) of $434,000.

Mr John M Carr, who directed the failed company until just two months before it was put into liquidation, is now sole director of Esprit Events Limited (a recently incorporated daughter company of CVC Group Ltd) which now holds the license for the Erotica Lifestyles Expo.

The Bay of Plenty Times reports

Tauranga City Council is proposing to make offensiveness one of the grounds for requiring permission to hold a street parade. But Mr Crow said he would fight the council.

“It won’t make any difference to me whatsoever,” he told the Bay of Plenty Times.

“I will take zero notice of any bylaw they bring in. I’m not vaguely interested in what the Tauranga City Council considers offensive. If they want to waste Tauranga ratepayers’ money, let them. I have plenty of money, I’m happy to fight them.” [Read more…]

Cynical Porn Parade Will Confront Children – says Family First NZ

Cynical Porn Parade Will Confront Children: Family First NZ Media Release 22/02/12

Family First NZ [a registered charity with the Charities Commission] is advising parents of school children in Palmerston North to be aware that there will be a public pornography parade featuring topless girls happening after children have been released from school on Friday. [It is again calling for politicians to “amend” the law “so that public porn parades and public displays of nudity are deemed offensive and indecent, and thereby illegal.”]

“The Erotica [Lifestyles Expo] Promotion, also known as Boobs on Bikes, is scheduled to travel around the central city square from 4pm. This is a cynical move by the hard core porn industry to expose children and young people to the industry,” says Bob McCoskrie, National Director of Family First NZ.

“We would advise parents to do everything they can to avoid children being exposed to this parade, and if necessary, they should keep their children at home for the day.”

Family First is disappointed that the parade is even able to happen in such a public venue but points the blame squarely at the police for not enforcing the law consistently, judges who believe that topless porn parades and nudity are not offensive, and the lack of political willpower to act in the best interests of families and children.

“Steve Crow can label it a ‘freedom of expression’ event, but to the intelligent, it is simply a cynical attempt to market and normalise the porn industry to families.”

“It is time that the rights of families not to be exposed to offensive and adult material are put before the rights of the pornography industry to promote themselves,” says Mr McCoskrie.

Family First NZ continues to call on the politicians to amend the Summary Offences Act and the Crimes Act so that public porn parades and public displays of nudity are deemed offensive and indecent, and thereby illegal.


Note: The licensee for staging Erotica Lifestyles Expo is Esprit Events Ltd , a company incorporated on 10 November 2011 by John Malcolm Carr CPA just days before the former licensee Eden Digital Ltd, also directed by John M Carr, was put into liquidation on 22 November. Carr is sole director of CVC Group Ltd,  which  owns Eden Digital Ltd (In Liq) and Esprit Events Ltd. On 16 September 2011 John Carr revoked the license Eden Digital held to stage Erotica. This was done on the same day he resigned as director of Eden Digital Ltd. On 11 November the license was transferred from Eden Digital Ltd to Esprit Events Ltd. CVC Group Ltd owns the trademark for “Boobs on Bikes” – used in the Erotica parade which markets Mr Carr’s hardcore porn business.