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Five Star figure keeps up fight to ditch guilty plea

Five Star Finance defacto director Neill Williams is trying again to back out of his guilty plea to misleading the collapsed financier’s investors.

And he is arguing it was his ill health which influenced him to plead guilty to the charges of making false statements in investment statements more than two years ago.

The attempt to vacate the plea is the third made by Williams, in his late 70s.

The first was dismissed by Judge Roderick Joyce QC in March 2011 and the second dismissed by Judge David Harvey a year later.

Judge Harvey said in his decision it appeared Williams' attempts to alter his plea were made because his Five Star directors had since been put in jail.

At Auckland High Court this morning, Justice Geoff Venning heard Williams' application for a judicial review of the decisions by the district court judges.

Williams' lawyer Andrew Speed said the judicial review was being sought on a narrow point in terms of what his role was in relation to the financier’s prospectus.

The Crown had elevated Williams to be the mastermind of Five Star, which collapsed in 2007 owing investors more than $90 million, Mr Speed said.

Williams had a managerial role in the company but was not involved in preparing the prospectus. Mr Speed said the charges suggested Williams was influencing the directors far more than he really did.

A new affidavit presented to the court today revealed Williams' illness was undiagnosed at the time he was charged. He had pleaded guilty because he was concerned about how he would stand up to an arduous trial.

Justice Venning, who heard the application, said he did not consider those to be grounds to overturn a guilty plea.

Crown lawyer Steve Symond opposed any suggestion that Williams did not know what he was doing when he entered his plea.

And Judge Joyce should not be criticised for evidence about William’s health that was not put before him at the time his application to vacate the plea was made, Mr Symond said. Williams had no clear defence, because he was present in meetings where the business of Five Star Finance was made.

Justice Venning has reserved his decision.

What did Williams plead guilty to?

Williams pleaded guilty to criminal charges laid by the former Companies Office – now the Financial Markets Authority – under the Securities Act and the Financial Reporting Act.

The charges relate to false statements contained Five Star’s September 2006 registered prospectus, and carry a maximum sentence of five years' imprisonment.

Although he was not a director of the company, and had not signed the prospectus, he was charged as a party to the directors who did put their names on the document.

Williams and three Five Star directors were also charged with fraud by the Serious Fraud Office over related party loans worth $50 million.

The trial, which Williams will face alone, was set down for June last year but was adjourned to June this year. 

This will see the Crown endeavour to show that Williams was the most culpable of the Five Star’s directors.

His co-accused have pleaded guilty to those charges.

In December 2010, Five Star directors Marcus Macdonald, 69, and Nicholas Kirk, 65, were sentenced to more than two years in jail for theft in relation to the misuse of funds at collapsed financier.

Five Star was placed into receivership in August 2007, owing about $46 million to investors.

gbond@nbr.co.nz

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