Friday 12th April 2013
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The Serious Fraud Office has added the scalp of former Dominion Finance and North and South Finance executive Paul Cropp to its tally of successful finance company prosecutions.
Cropp was today found guilty in the High Court in Auckland relating to related party lending totaling approximately $13.57 million in breach of the companies trust deeds, the SFO said in a statement. Former director Robert Whale and another associate with name suppression were found not guilty of five and three charges respectively.
"SFO are pleased to have brought another finance company case to an end," acting chief executive Simon McArley said. "These prosecutions deliver a strong deterrent to future offending."
The conviction takes the white-collar crime investigator's successful finance company prosecutions to four, after convictions in the Capital + Merchant Finance, Bridgecorp Finance and National Finance 2000 cases. The SFO has a few other cases in the pipeline, including South Canterbury Finance and Five Star Finance and is still to decide whether to pursue Hanover Finance.
Other finance company prosecutions, including Lombard Finance & Investments and Nathans Finance, were for securities law breaches rather than fraud.
McArley said the key to reducing the cost of economic crime is early action.
"SFO can only achieve this with strong interagency collaboration and the support of the community in reporting suspect and unethical behaviour," he said.
Dominion Finance Group had 5,937 debenture holders with $176.9 million invested at the time of receivership in 2008. North South Finance was put in receivership in 2010. Both were subsidiaries of NZX-listed Dominion Finance Holdings, which was placed in liquidation in 2009.
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