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Bridgecorp's directors found guilty, Petricevic & Roest in custody

Thursday 5th April 2012

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The directors of failed lender Bridgecorp have been found guilty of making untrue statements in offer documents, managing director Rod Petricevic and chief financial officer Rob Roest were remanded in custody.

Judge Geoffrey Venning in the High Court in Auckland today found Petricevic and Roest guilty of all 10 charges of breaching the Securities Act, while director Peter Steigrad was found guilty on six of the 10 charges.

Petricevic and Roest were also charged under the Crimes Act for making false statements on offer documents with the intent of encouraging people to invest in the finance company and the Companies Act after they knowingly made misleading statements about the company to creditors.

Judge Venning rejected Petricevic’s and Roest’s defences they believed the statements were true.

“In each case I have found that untrue statements were included in the offer documents , that the offer documents were distributed at the relevant time referred to in the court and that the accused signed or had signed on their behalf the offer documents,” Judge Venning said in his judgment.

“I have also found that they knew from or shortly after 7 February 2007 that Bridgecorp had missed payments of principal and interest due to investors,” Venning said.

Petricevic will be sentenced on April 26, while Roest and Steigrad will be sentenced on May. 18. Petricevic and Roest will remain in custody until then. Steigrad has been remanded on bail.

“He had an honest belief that the statements were true during the time the offer documents were distributed,” Judge Venning said. “On the counts I have found him not guilty of I have also accepted that at the relevant time Steigrad’s belief was a reasonable held one.”

Company chairmen Bruce Davidson pleaded guilty last year and was sentenced to home detention and community service, and paid $500,000 in reparation. Director Gary Urwin also pleaded guilty and is awaiting sentencing.

Bridgecorp collapsed in 2007, owing some 14,000 investors about $459 million. The failed lender’s receivers expect just 3.5 cents in the dollar, or $16.1 million, will be repaid to investors.

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