Hubbard's likely defences

Allan Hubbard, facing 50 counts of fraud in relation to his Aorangi Securities and Hubbard Management Funds, has his next court appearance pencilled in for July 4, but Without a Word of a Lie reckons this hearing is likely to only spark the opening salvo of a legal wrangle that will likely stretch into 2012.

Mr Hubbard’s able legal team, led by Serious Fraud Office prosecutor Mike Heron, has already flagged a  “not guilty” plea but this is hardly the only legal defence likely to be mounted by Russell McVeagh.

The first point to note is the sheer weight of charges – 50 counts of fraud – will inevitably be slimmed by the time any trial starts.

There is likely to be repetition in the 50 charges, leading to judicial pruning, and the sentence handed down if Mr Hubbard is found guilty on 50 counts is unlikely to differ substantively from guilty on only five charges.

Mr Heron has already flagged an application to strike out the prosecution and such moves could draw on Mr Hubbard’s poor health and complications arising from the imposition of statutory management.

The age of Mr Hubbard (83) is also likely to get an airing. Judging from other fraud cases it could well be over a year before trial begins, which could make Mr Hubbard – who will then be at least 84 – one of New Zealand’s oldest defendants.

It is understood claims regarding the ill-health of Mr Hubbard - noting his brush with cancer, regular dialysis treatments, and the results of an MRI brain scan - have already been submitted by Russell McVeagh to the SFO.

SFO director Adam Feeley appeared to give such submissions short shrift in his announcement yesterday. “Any issues over fitness to stand trial will be matters for the court to adjudicate on,” he said.

When Mr Heron raises these matters is unclear but,, in the coming months, it is almost certain an application will be made asking for the court to declare Mr Hubbard unfit to stand trial.

The placing of Mr Hubbard into statutory management on June 20 last year also complicates any prosecution and may open several avenues for a defence - mostly around access to documents and funding.

Russell McVeagh has already had to go to court to secure part-payment of its legal costs, understood to already exceed $2.5 million, and the question over whether Mr Hubbard has the funding to mount a fair defence is still a live issue.

Mr Hubbard’s documents recording Aorangi and Hubbard Management Funds transactions - likely to form key evidence in any trial - are also now in the hands of Grant Thornton.

There have also been mutterings heard from the Hubbard camp that statutory managers have been playing the role of Mr Hubbard’s legal representative as well an investigator for the prosecution during their year-long reign over Mr Hubbard's affairs.

Finally, as unpalatable as it might seem to Mr Hubbard’s supporters in Timaru, an admission of guilt on lesser charges is still a possibility.

With legal bills for both sides expected to run into the millions were the case to go to trial, and a judge unlikely to imprison a sickly octogenarian, a negotiated guilty plea may prove the easiest - and cheapest - way out for all sides.