Mortgage company trades on as director faces sentence

By Nick Stride

Thursday 28th March 2002

BUSINESS AS USUAL: An ad in Wednesday's New Zealand Herald

Contributory Mortgage Investments continues to advertise for investors' money despite one of its directors being found guilty of criminal charges involving contributory mortgages.

Peter Van Nieuwkoop, the manager involved in the Reeves Moses contributory mortgage fiasco, faces fines of up to $240,000.

The Ministry of Economic Development's national enforcement unit last Friday won a case claiming Van Nieuwkoop breached s58 and s59 of the Securities Act Contributory Mortgage Regulations on 35 counts.

Auckland District Court heard investors in the schemes to which the charges were related faced losses or potential losses of more than $4 million.

Despite the finding against Van Nieuwkoop Contributory Mortgages Investments advertised for public money in Wednesday's New Zealand Herald.

Van Nieuwkoop is attempting to avoid having a conviction entered against him by way of a Criminal Justice Act s19 discharge, a manoeuvre likely to be opposed by the Crown.

Sentencing has been deferred until May, when a Crown appeal against the dropping of charges against former Reeves Moses directors Roger Stevens and Gary Moses will be heard.

The charges against Van Nieuwkoop involved distributing prospectuses containing false information and failing to make declarations required by the Companies Act.

In one case Reeves Moses raised money from the public to finance a residential development in Auckland's Mangere.

But $670,000 of the money was lent on a property purchase in Mt Eden, without the contributors' knowledge.

Crown prosecutor Brian Dickie said "short of outright theft or fraud this is as serious a breach as could occur with contributory mortgage lending as there was, as a result, no security over the [Mt Eden] property."

Judge Barry Morris was not convinced by Van Nieuwkoop's contention he was not "a principal officer" of Reeves Moses at the time.

Nor was he swayed by Van Nieuwkoop's complaints of overwork.

Van Nieuwkoop claimed that in two and a half years he wrote $176 million of mortgages.

He claimed he also had onerous other responsibilities.

Judge Morris said "the huge pressures" were "a mitigating factor only, not a defence."

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