Former Bridgecorp director Bruce Davidson has lost a High Court bid to return to business.

Mr Davidson was a director of six companies in the Bridgecorp group, which collapsed in 2007 owing investors in its debt securities about $486m.

He was the chair of parent company Bridgecorp Holdings.

After the collapse, Mr Davidson was banned from being a director, promoter or manager of a company for two and a half years from 1 December 2009.

The Deputy Registrar of Companies found that Mr Davidson had high integrity but was “too trusting” of Bridgecorp employees and executive directors.

His appeal against the ban has been thrown out by the High Court in Wellington.

Mr Davidson argued that, as a commercial lawyer rather than an accountant, he was entitled to rely on managers and fellow directors for financial matters.

He also argued that the Registrar of Companies should have held off on the prohibition until other criminal proceedings had run their course.

Justice Forrest Miller accepted Mr Davidson’s defence of his integrity – but found that directors are required to have a reasonable degree of financial literacy, among other skills.

He upheld the prohibition.

“I accept that the public has nothing to fear from Mr Davidson,” he said in a judgment released today.

“He has learned a painful lesson and I expect that his trusting nature will not again betray him in a commercial setting, nor will he accept an office for which he is not fully qualified.”

However, Justice Miller found that prohibition is equally important for standard-setting and as a general deterrent.

“Mr Davidson‘s lapses point to a failure to appreciate the nature and extent of his responsibilities and his excuses point to a need to set standards that require rather more of a director than mere honesty.”

He found that the prohibition and criminal liability proceedings are separate processes and that no error of process had occurred.