Petricevic's $500k tax bill paid by Bridgecorp

Rod Petricevic. File photo / Brett Phibbs

Former Bridgecorp director Rod Petricevic's $500,000 tax bill was paid with company money, a court has heard.

The Financial Markets Authority accuses Petricevic - and fellow directors Rob Roest and Peter Steigrad - of making untrue statements in the offer documents of Bridgecorp and Bridgecorp Investments.

The accused, who each face 10 Securities Act charges, deny the allegations.

Bridgecorp collapsed in July 2007 owing 14,500 investors about $490 million.

Petricevic and Roest also face eight charges under the Crimes Act and Companies Act of knowingly making false statements in offer documents that Bridgecorp had never missed interest payments or repayments of principal to investors.

Former Bridgecorp treasurer John Welch continued giving evidence yesterday as the trial wrapped up for the year.

While on the witness stand, he said the company paid Petricevic's personal tax bill.

The sum of around $500,000 was recorded in Bridgecorp's accounts as a receivable, he said.

"I think it was treated as an advance to Mr Petricevic," Welch said.

Yesterday, Welch also discussed the loans Bridgecorp sold to other finance companies so it could pay investors.

"I guess at that stage we [were not] getting a lot of new monies because of the market situation ... it was really to ensure the company was able to meet its obligations," he said.

According to documents tabled in court, Bridgecorp gained about $40 million from refinancing of loans between June 2006 and July 2007.

Yesterday's hour-long session concluded proceedings for the year, before resuming on January 23.

Crown and defence lawyers will meet next Thursday to discuss some housekeeping matters - the same day former Bridgecorp director Gary Urwin will be sentenced.

Urwin originally pleaded not guilty to Securities Act charges but changed his plea last month. The Crown is seeking a term of imprisonment.