Retired Carter Holt Harvey executive Maurice Reid was fined $20,000 this week for breaching the Fair Trading Act.
Reid is one of six executives the Commerce Commission prosecuted for their alleged involvement in labelling wood with misleading grades.
Despite having access to information that showed timber was not
consistently meeting the MGP10 grade, Reid continued to oversee production of the timber for 2 1/2 years, knowing it was being sold with an MGP10 grade, the commission said.
CHH's annual MGP10 sales in the period were approximately $63.4 million.
The fine was imposed on Thursday after Reid last month pleaded guilty in the Auckland District Court to 17 charges of engaging in conduct that was liable to mislead the public. The charges relate to the period July 2000 to December 2002, when he was general manager of CHH's wood products division.
In October last year CHH was fined $900,000 for selling timber labelled as MGP10 when it knew the timber did not consistently meet that grade.
MGP10 is a high-strength timber used for trusses and framing in homes and buildings. It was marketed as a premium product.
Use of incorrectly graded timber in a roof truss can cause sagging or deflection but not the failure of the truss.
It is estimated that 20,000 houses were built with Laserframe MGP10 supplied by CHH during the period.
The commission investigated after concerns were raised by the New Zealand Timber Industry Federation.
CHH has since been taken over by billionaire Graeme Hart.
- NZPA
