Two Serious Fraud inquiries dropped

By Tamsyn Parker

The Serious Fraud Office has dropped investigations into two finance companies but says it is drawing up charges on a third.

SFO boss Adam Feeley yesterday confirmed it had finished its investigations into Clegg & Co Finance and Club Finance.

Feeley said it had decided against pursuing the Clegg & Co Finance case further because charges had already been laid by the Companies Office and it believed there was "insufficient public interest".

Clegg & Co Finance went into receivership in October 2007 leaving 500 investors at least $6.5 million out of pocket.

Brian Clegg, the sole shareholder of its parent company Clegg & Co, was sentenced to 12 months' home detention in December last year after pleading guilty to misleading investors, the company's trustee and the Securities Commission.

Clegg admitted to breaching the Securities and Companies Acts by signing untrue prospectuses, giving false or misleading reports and quarterly returns to Clegg & Co Finance's trustee and attempting to deceive the Securities Commission.

Feeley said it had finalised a second investigation into car lending company Club Finance after it had found no evidence of criminal offending.

But it was now looking at transactions involving related parties of Club Finance after "issues of concern" had come to light as part of its investigation.

"The SFO has now commenced an investigation into those transactions, but will not be commenting further until those investigations are complete."

Feeley said it was drawing up charges for another case.

He would not say which company the potential charges would relate to.

The SFO has yet to charge any finance company directors despite more than two-and-a-half years having passed since the collapse of Bridgecorp, which left 14,500 investors $459 million out of pocket.

The SFO is investigating Bridgecorp, Blue Chip, Five Star, Nathans Finance, National Finance, and Capital + Merchant.

- NZ Herald

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