Eighteen months jail for National Finance accountant

The Serious Fraud Office says the imprisonment sentence handed down to the former accountant of National Finance 2000 sends a clear message on the seriousness of white-collar crime.

John Gray, 41, a former company accountant at the failed motor vehicle financier, was today sentenced at the Auckland District Court to 18 months in prison.

However, he is appealing the decision not to grant him home detention and remains on bail pending determination of that matter – expected in March.

Gray was one of two men the SFO has charged for their role in National Finance, which collapsed in 2006 owing investors more than $21 million.

It was three years later that Gray, and the financier’s sole shareholder and director Trevor Allan Ludlow, were charged with misusing investors’ funds.

Gray, the former company accountant, pleaded guilty to three of four charges laid by the SFO in October and appeared at the Auckland District Court for sentencing today.

The charges related to theft by a person in a special relationship, which related to misuse of National Finance Funds in breach of its trust deed requirement.

The SFO had dropped one charge after Gray agreed to pay reparations of $50,000 and agreed to give evidence against a co-defendant.

Gray also pled guilty to a charge of false accounting, whereby he concealed the true recipient of funds by creating a false document.

SFO chief executive, Adam Feeley, said the decision would have important ramifications for the additional finance company cases under investigation and prosecution by the SFO.

“Results like this demonstrate that the seriousness of white collar crime. It will be of great comfort to investors, and sends a positive message to the investing public about the integrity of our financial markets, and the consequences for breaching the law,” said Mr Feeley.

Mr Ludlow is yet to enter a plea in relation to the charges and a trial date has yet to be set.

Two other former directors of National Finance also face criminal charges laid by the Ministry of Economic Development’s National Enforcement Unit in 2008.

It is alleged that directors Anthony Banbrook, Carol Braithwaite and Mr Ludlow failed to disclose material transactions between the company and related parties such as Payless Cars group and Great North Management.

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