National Finance accountant appeals prison sentence

Thursday 24th March 2011

Former National Finance accountant John Gray has appealed his jail sentence for false accounting and theft by a person in a special relationship, saying he should get home detention.

Gray was sentenced in November at the Auckland District Court to 18 months in prison after pleading guilty to the charges relating to falsifying investment statements at the failed finance company, which went into receivership in 2006 owing investors $24 million.

The jail sentence was heralded last year as sending a message to the finance industry.

However, Gray's lawyer Sanjay Patel referred to the recent sentencing of John Hotchin to 11 months home detention after pleading guilty at the High Court in Auckland to Securities Commission charges relating to the collapse of Nathans Finance in 2007.

Patel said that while Hotchin was the principal in his firm Gray was simply the accountant who had "tidied things up" after investments were made by the firm's principal that breached its lending ratio.

Nick Williams, for the Serious Fraud Office (SFO), said Gray's actions constituted serious market fraud as information he falsified made its way to "hundreds, if not thousands, of investors."

Williams also said the defence had not shown that the sentence was excessive.

Justice Rebecca Ellis reserved her decision and Gray remains on bail pending the outcome.

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