Marac finds evidence of historical loan cover-up

Marac has discovered a $2.5 million dodgy loan on its books that dates back seven years and the evidence points to a cover up.

In an announcement to the NZX today, Marac and parent company Pyne Gould Corporation said an internal audit of the company’s lending activities had “uncovered an irregularity” in one particular business loan.

The loan – which dates back to 2003 – was the only irregular loan found under a new auditing processes that was introduced in October.

Marac is keeping quiet about the details of the deal, saying the circumstances behind the irregularity had only recently been ascertained, but did say it involved lending that was outside the company’s internally prescribed practices.

It said the circumstances did not appear to have involved personal gain, although evidence did point towards somebody "suppressing" the unauthorised lending.

A provision of $2.5 million post tax will be made in the company’s half-year result, due later this month, although Pyne Gould said it remained confident it would not have a major impact its full year earnings.

The company is refusing to make any further comment regarding the loan until its results.