An ex-All Black accused of managing two businesses while bankrupt allegedly removed the director of one of these companies when the man refused to provide signed blank cheques to the former top-level player.
The allegation was revealed in a High Court decision released this month that declined to discharge Christopher (Kit) Fawcett from bankruptcy.
Fawcett, who played two test matches for the All Blacks in 1976, was declared bankrupt in September 2010 over an outstanding $1.34 million debt to the Southland Building Society for money borrowed on a failed subdivision, the Tairua Palms Estate in the Coromandel.
Fawcett would have been discharged automatically from bankruptcy in October last year but the Official Assignee opposed his release.
Shortly after this, the OA - which manages bankruptcies - last October laid two charges against Fawcett.
One alleges he ran a business between October 2011 and October 1 last year and the other that he ran a business between May 2012 and April last year.
Undischarged bankrupts cannot take part in the management of any business without the consent of the OA and the charges Fawcett faces come with a maximum penalty of two years imprisonment if he is convicted.
At a hearing in the High Court at Hamilton in December, Fawcett applied for an immediate and unconditional discharge from bankruptcy.
Fawcett, who represented himself, told Mary Justice Peters he had complied with his obligations and was entitled to be discharged and said the OA was on a "witch hunt".
The OA's lawyer, Phillip Cornege, told the judge that no order for discharge should be made, given how Fawcett had conducted himself since being declared bankrupt.
The OA said Fawcett had be closely involved with the management of two companies, JEC No 3 and Kingsland Station. These allegations form the basis of the charges the OA laid against him.
JEC is a trustee of a trust settled mainly for the benefit of Fawcett's children.
The OA submitted during the hearing that Fawcett was a property manager for JEC.
He also allegedly removed JEC's director and substituted another man when the former refused to continue taking instructions, which included providing Fawcett signed blank cheques drawn from the trustee's current account.
While Fawcett said that emails and statements put to him during the hearing did not provide sufficient basis to refuse his discharge, Justice Peters did not accept this.
"In my view they raise serious issues as to the manner in which Mr Fawcett has conducted himself since [being adjudicated bankrupt]...I accept the submission for the OA that the documents are evidence that Mr Fawcett was closely involved in the management of the affairs of both JEC and Kingsland, and particularly the latter," Justice Peters said.
"Of course, whether Mr Fawcett has committed offences under the [Insolvency] Act is a different matter raising different issues. Nothing in this judgement should be taken as expressing any view on the merit of the charges," the judge said.
Justice Peters dismissed Fawcett's application for discharge. The judge said Fawcett may make another bid for release from bankruptcy when the charges against him are determined or after December 1.