Dominion Finance boss jailed
Dominion Finance boss Paul Cropp has been sentenced to two years and seven months imprisonment.
Justice Graham Lang delivered the sentence at Auckland High Court late this afternoon.
Cropp, who turned 50 yesterday, was found guilty of theft in relation to the collapsed finance company last month, following a six-week, judge-alone trial.
The theft charges, brought by the Serious Fraud Office, involved related-party lending of about $13.57 million in breach of Dominion's trust deeds.
He is the first chief executive, in the recent finance company trials before the court, to be convicted.
Justice Lang chose a starting point of three years and four months jail, less than the sentences imposed on directors of Five Star Finance and Capital + Merchant Finance in related-party loan cases.
Unlike these other offenders, Cropp had not personally gained from his offending and his motivation was “having Dominion Finance remain afloat”, the judge said.
Crown prosecutor Brian Dickey pushed for a starting point of five to five-and-a-half years, while defence lawyer John Billington QC said home detention would be appropriate.
Justice Lang gave Cropp a discount of six months for good character, citing his “impeccable” record prior to the offences, and a further three months for remorse.
He said the convictions for theft would have a “devastating effect” on Cropp, who will have great difficulty finding future employment in any financial role.
Two other men - Dominion Finance director Robert Barry Whale and a third company executive who has name supression - were found not guilty of the charges.
A fourth director, Terry Butler, who recently died of cancer, was excused from the trial late last year.
Cropp, who had a large crowd of supporters in court, had been remanded on bail until sentencing today.
Dominion Finance Group was placed in receivership in 2008, owing almost 6000 debenture holders $176.9 million. Subsidiary North South Finance was placed in receivership two years later, owing 3900 debenture holders $31 million.
Both companies were subsidiaries of NZX-listed Dominion Finance Holdings, which was placed in liquidation in 2009. They offered property and commercial loans.
Receivers have estimated recoveries of 10c-25c in the dollar for debenture holders in Dominion Finance Group and of 65c-70c in the dollar for those in North South Finance.