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Three directors of Capital + Merchant Finance were jailed today.
Neal Medhurst Nicholls (56) and Wayne Leslie Douglas (58) were both sentenced to seven and a half years' imprisonment.
Owen Francis Tallentire (65), the firm's boss, was sentenced to five year's jail.
Justice Ed Wylie delivered the sentence at Auckland High Court this afternoon.
The fraud charges they faced under the Crimes Act related to $28 million worth of property and investment loans advanced by Capital and Merchant Finance between 2005 and 2006.
Douglas and Nicholls were found guilty of all three of the theft charges they jointly faced. Tallentire, the firm’s boss, was found guilty of two.
The trio have been in jail, awaiting sentencing, since Justice Wylie delivered the guilty verdict on July 19.
SFO chief executive Adam Feeley said the $167.1 million collapse of Capital + Merchant represented some of the worst excesses of the finance companies.
“These sentences support that point of view. They will send a strong message to the commercial sector regarding the severity of punishment that will follow cynical crimes of these kind.”
The SFO is seeking to appeal not guilty verdicts against Nicholls and Douglas from a separate Capital + Merchant trial in April-May.
These relate to the non-disclosure of alleged related party lending totalling approximately $14.4 million.
Capital + Merchant Finance owed $167.1 million to about 7500 investors when it was placed in receivership in November 2007 – an average of about $22,280 per investor. Recoveries are unlikely.
By comparison, Bridgecorp owed $559 million to about 14,500 investors, Nathans Finance owed about $174 million to some 7000 investors and Lombard owed $127 million to 44,000 investors.