Hamish Fletcher

Business reporter for the NZ Herald

'Self-interest and greed' earn record jail terms for directors

Capital + Merchant Finance directors (from left) Wayne Douglas, Neal Nicholls and former CEO Owen Tallentire. Photo / Sarah Ivey
Capital + Merchant Finance directors (from left) Wayne Douglas, Neal Nicholls and former CEO Owen Tallentire. Photo / Sarah Ivey

Two former Capital + Merchant Finance directors have been sentenced to 7½ years in prison - the longest jail terms imposed on failed finance company bosses.

Wayne Leslie Douglas and Neal Medhurst Nicholls - with Owen Francis Tallentire - loaned investor money for their own benefit in ways that breached Capital + Merchant's trust deed.

Douglas, Nicholls and Tallentire jointly faced three charges of theft by a person in a special relationship for a series of loans totalling almost $20 million.

Douglas, 59, and Nicholls, 56, were found guilty on all three charges in July.

Tallentire, 65, was found guilty of two and acquitted on the other.

In the High Court at Auckland yesterday, Justice Edwin Wylie sentenced Douglas and Nicholls to 7½ years in prison after giving them a discount for their remorse and previous good character.

Tallentire, C+M's former chief executive, was granted a similar concession and jailed for five years.

Justice Wylie said the directors' actions were cynical.

"The offending was sophisticated," he said. "It was not spur-of-the-moment opportunism.

"Each of the offenders was driven by self-interest and greed."

He did not impose minimum terms of imprisonment on the three men, so they will be eligible for parole after serving one-third of their sentences.

Reading victim impact statements, the judge said many C+M investors were elderly and some had lost their life savings

"The impact on them and their families has been far-reaching and dramatic," he said.

C+M collapsed in November 2007 owing $167 million to 7500 investors.

They are likely to see none of their money back.

None of the three was in a position to pay reparations to investors, the court heard yesterday.

SFO chief executive Adam Feeley said the sentences sent a strong message that severe punishment would follow "cynical crimes of these kind".

"We have long maintained that the collapse of Capital + Merchant represented some of the worst excesses of the finance-companies saga, and these sentences support that point of view," he said.

Until yesterday, the longest prison term in relation to a financial collapse was the 6½ years imposed on Bridgecorp's Rod Petricevic and Robert Roest, who were jailed in April and May on charges laid by the Financial Markets Authority and the SFO.

Lawyers acting for Nicholls, Douglas and Tallentire all pushed yesterday for sentences of home detention and community service.

- NZ Herald

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