The charges against: Bridgecorp
The following is details of the case referred by Securities Commission to National Enforcement Unit of Ministry of Economic Development for prosecution against Bridgecorp and Bridgecorp Investments.
Friday, December 3rd 2010, 6:02PM
Bridgecorp was one of the biggest and earliest finance companies to collapse and received a lot of media attention due to the profile of its founder Rod Petricevic.
Investors have been told they will probably get less then 10c in the dollar back.
The case goes to trial in the High Court on July 4, 2011, nearly three years to the day after the company collapsed.
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Defendants |
Rodney Petricevic, Robert Roest, Bruce Davidson, Gary Urwin and Peter Steigrad |
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Charges |
The Commission alleges the directors made untrue statements in the investment statements and registered prospectuses of Bridgecorp and BIL dated 21 December 2006. These statements concerned Bridgecorp's overall financial position, solvency, and liquidity which the Commission believes had been substantially deteriorating since 30 June 2006. BIL was affected by this because it depended on Bridgecorp to be able to repay its own investors. Other alleged untrue statements concern related party lending, lending policies and procedures, that Bridgecorp had never missed an interest or principal repayment, and that all material information had been disclosed in the prospectus. The Commission also alleges that the directors made further untrue statements when they signed prospectus extension certificates for Bridgecorp and BIL on 30 March 2007. These stated that the companies' financial position had not materially and adversely changed since the last balance date, and that the 21 December 2006 prospectuses were not false or misleading. The Defendants deny the charges. The SFO has also laid charges relating to these companies. |
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Penalties |
Criminal charges - these charges are laid indictably under section 58 of the Securities Act and carry a maximum penalty of five years imprisonment or fines of up to $300,000 Civil proceedings - the proceedings are issued under section 55C and related sections of the Securities Act. The Commission has applied for declarations of civil liability and civil pecuniary penalties of up to $500,000 against each of the five directors. |
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Date filed |
Criminal charges -12 December 2008 (non-executive directors), 11 May 2009 (executive directors) in the District Court at Auckland. Civil proceedings -12 December 2008 at the High Court in Auckland. |
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Current status |
Criminal charges - High Court trial set down for 4 July 2011 (10-12 weeks). Pre-trial hearing scheduled for 14 and 15 March 2011. Civil proceedings - stayed pending resolution of the criminal case. |
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