Imagine dreaming of sunny voyages across the South Pacific, only to find your investments sinking like a ship in a storm – that's the harsh reality for dozens of Australian sailing lovers caught in a tangled yacht funding plan. This isn't just a story of high-seas adventures gone wrong; it's a cautionary tale about promises of easy money and the bitter aftermath when things unravel. But stick around, because while sailing might seem like a glamorous hobby for the elite, this case reveals a darker side that could make you question the allure of luxury investments forever.
And this is where it gets controversial – a scheme that lured people with visions of 20% annual profits and cut-rate trips, only to leave them high and dry. Picture this: a group of companies under the banner of Ocean Sailing Expeditions, spearheaded by New Zealand's well-known sailor and business figure David Hows, offered memberships in a collection of high-end yachts. Investors shelled out up to $100,000 for what was billed as a 'secured stake in the vessel,' expecting yearly payouts and travel perks around Oceania. After five years, the plan promised a full refund of their initial stake. It sounded too good to be true – and for many, it was.
But here's where most people miss the real drama: crew members, subcontractors, and even some international backers are now chasing unpaid debts from this web of businesses. The trouble escalated when two yachts, the Silver Fern and the Te Kaihopara, were seized in early December following legal moves by ex-employees. The Silver Fern, a sleek 22-meter boat, was freed after Hows forked out over $100,000, just in time for it to race in the prestigious Sydney Hobart Yacht Race over the holidays. Meanwhile, the Te Kaihopara stays moored and locked in Auckland. A third vessel, the Awen, has joined them on the auction block as Hows hustles to settle what he owes.
Hows, an experienced sailor who's crossed the Tasman Sea numerous times, paints a picture of his venture under siege. He alleges a deliberate sabotage by competitors and a handful of unhappy staff. "I've faced personal threats, warnings of gang involvement at my door, jail time, financial ruin, and public humiliation," he claims. We haven't pinpointed the culprits he's referencing, but it's clear the accusations add fuel to the fire.
To break it down for newcomers: these yacht investment schemes promise returns by letting you 'own' a piece of a boat that generates income from charters and trips. In theory, it's like buying stock in a floating hotel – but without the regulatory safeguards of traditional investments. Here, the business model hinged on growing the fleet and attracting more members, which apparently led to cash flow issues.
And this is the part most people miss – the financial red flags that were waving long before the ships were seized. Hows is under scrutiny from a liquidator for his previous Australian firm, OSE QLD Pty Ltd, which folded with over $565,000 in debts and barely 95 cents in the bank. A report from liquidator Mackay Goodwin uncovered that the company was insolvent since March 2022, plus suspicious transfers totaling $875,332 to another entity, LV2 Pty Ltd, co-owned by Hows' wife. The liquidator flagged $296,441 in potentially unfair deals, labeling them as "uncommercial" and possibly "unreasonable director-related transactions" in a filing to the Australian Securities and Investments Commission on December 19. Hows pushes back, denying the insolvency stretched three years and claiming he's supplied proof to the liquidator just before Christmas. He accuses the firm of rushing an error-filled report right before the holidays.
Take the story of Sydney residents Kelly McRae and Jonathan Plesman, who poured $50,000 from their self-managed retirement savings into the scheme via Hows' firm Willow Vale Consulting Pty Ltd. As fellow boaters, they were charmed by the ethical vibe and the backing of an established vessel. "It felt exciting and responsible, like a solid plan built on real experience," McRae shared. But cracks appeared fast: missed payouts, and it dawned on them that the sparse dividends they got were propped up by fresh investments from others. Now, they're out $80,525 in unpaid returns and principal, having turned down Hows' December 15 proposal that involved selling the yachts but making them drop out of the liquidation process. They're not alone; several have filed grievances with ASIC over the handling of Hows and his companies.
Jason Haigh, a Sydney skipper hired for the Silver Fern in April 2024, spotted warning signs early. "I saw trips being booked for new clients while Hows couldn't cover bills for suppliers, workers, or the team," he recounted. He sued in Federal Court for nearly $15,000, which got paid when Hows paid to release the yacht before Christmas. Still, he's owed around $10,000 from his time on the Te Kaihopara. Haigh describes Hows as always buying time with partial settlements: a meeting in May 2025 pleading tight finances, followed by tiny payments that stopped after the August liquidation.
Then there's Matt Harvey, another Sydney local, who rented his 22-meter ketch, Salt Lines, to the operation in late 2021 for Australian and South Pacific excursions. He's still waiting on about $160,000. "I tried resolving it amicably first, but it didn't work," he said. "The endless chase has been draining, both financially and emotionally." To explain for beginners, liquidations like this are when a company is wound up to pay off debts, often leaving creditors scrambling for scraps.
Hows won't disclose the total owed, citing it as "commercially sensitive" to avoid hurting yacht sale prices. At 55, he admits delayed payouts but points to over $2.7 million sunk into boat repairs and improvements over five years. He blames the rising membership costs for the strain, calling the old setup "overly generous." His fix? Shifting to a model where owner-operators handle their own boats, crews, and split revenues from bookings. "We'll pay all past staff by January's end," he vows. "I'm fighting to save years of effort and keep this afloat."
But here's where it gets really controversial – is this a victim of bad luck and rivals, or a classic case of overpromising in a risky industry? Yachting investments can be thrilling, offering a taste of adventure with potential profits, but as this saga shows, they're prone to storms like maintenance costs, market fluctuations, and human conflicts. Some might argue Hows deserves sympathy for pouring his life into it, while others see red flags in the transfers and delays that scream mismanagement. What do you think – can these schemes ever be ethical, or are they doomed to founder? Share your take in the comments: Do you side with the investors or the entrepreneur? Have you heard of similar investment pitfalls in leisure industries?
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