Stephen Smith, former director of the failed Belgrave Finance, has pleaded guilty to 25 charges of fraud related to the collapse of the company in 2008.
Smith pleaded guilty in the High Court in Auckland to 25 charges, including 19 under the Crimes Act of theft by a person in a special relationship, four charges of false statement by promoter, one Securities Act charge of making an untrue statement and one Companies Act charge of making a false statement to a trustee.
The charges were brought in a joint prosecution by the Financial Markets Authority and the Serious Fraud Office. Belgrave, which provided finance for property developments from funds raised via debentures and capital notes, was put in receivership in May 2008 owing $22 million to about 1,000 investors. It was placed in liquidation in April 2010.
Smith has been remanded in custody pending a bail hearing later today and will appear for sentencing on June 7. His conviction means he is banned from managing companies for five years.
AdvertisementAdvertise with NZME.
The charges relate to more than $18 million of loans made by Belgrave Finance to various related entities between June 2005 and March 2008, according to the SFO's statement.
Charges have also been laid against former director Shane Buckley, alleged controller of the company Raymond Schofield and legal advisor Hugh Hamilton. Buckley was sentenced to three years' jail after pleading guilty last August. Schofield was granted a stay of prosecution on the grounds of terminal illness and Hamilton has been committed for trial at a date to be set, the SFO said.