Friday 28th June 2013
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Convicted Capital + Merchant fraudsters Wayne Douglas and Neal Nicholls have had their prison sentences topped up after pleading guilty to Securities Act charges of making untrue statements in offer documents.
Douglas had another eight months added to his seven-and-a-half year jail term and Nicholls was sentenced to a further 12 months to his same-sized jail term, the Financial Markets Authority said in a statement. The pair pleaded guilty to the Securities Act charges in February after fellow directors admitted similar charges.
"Wayne Douglas and Neal Nicholls misled the public to get them to invest in Capital + Merchant Finance," said FMA head of enforcement Belinda Moffat. "If investors had known what was really going on, it is unlikely they would have invested at all. The offending has had a grave impact on investors both financially and emotionally."
Last year, Douglas and Nicholls were jailed for their role in the $28 million fraud, which was described in the Court of Appeal as "theft on a grand scale", while former chief executive Owen Tallentire was imprisoned for five years.
The Capital + Merchant fraud case was broken up into two trials, with the first part dealing with so-called 'Hub' property deals in Palmerston North, of which the three were acquitted. The trio were convicted in relation to the second part of the case relating to related party transactions between 2004 and 2006.
Capital + Merchant Finance collapsed in 2007 owing some $167.1 million to about 7,500 investors.
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