National Finance's Banbrook blames Ludlow – court

Banbrook, who earlier pleaded guilty to making a false statement in a National Finance prospectus, was to be sentenced in Auckland High Court today.

But he has disputed facts in the summary of facts before Justice Tim Brewer.

Queen's counsel Harry Waalkens said Banbrook objected to the statement he was "grossly negligent" and ignored or abdicated his responsibility as a director.

And he was unaware of National's related-party lending because of the extent Ludlow went to cover his tracks.

Mr Waalkens wanted Justice Brewer to proceed with sentencing on the basis his culpability was at the lower end of the spectrum.

But the Crown didn't accept this, arguing Banbrook was aware of the related party lending and, in abdicating or ignoring his responsibility as a director, was grossly negligible.

Justice Brewer indicated the difference between the Crown's case and Banbrook is one of significance for his sentencing exercise.

The matter is likely to now be explored during a disputed facts hearing.

Justice Brewer formally convicted Banbrook of the offence to which he pleaded guilty today. 

He remains on bail at his Auckland home but has surrendered his passport. 

Banbrook was to have been sentenced on August 14 but it was postponed because defence counsel submissions were late.

One of four National Finance directors to be prosecuted for their part in the firm's collapse, he pleaded guilty ahead of trial to one charge of making untrue statements in National's prospectus.

The charge, brought by the Financial Markets Authority, carried a maximum penalty on conviction of five years' imprisonment or a fine of up to $300,000.

He was to stand trial alongside fellow director Carol Braithwaite last month, but entered a last-minute guilty plea in June.

After pleading guilty he asked the judge if he could still go to Fiji for a pre-booked holiday ahead of his sentencing – a cheeky request Justice Mark Woolford declined.

Braithwaite, the former wife of National Finance's boss and owner Ludlow, was found guilty by a jury and will be sentenced next month.

Ludlow was sentenced to six years and four months in jail in October last year afer being found guilty of false accounting and theft by a person in a special relationship.

The financier's accountant, John Gray, pleaded guilty to theft by a person in a speical relationship and one charge of false accounting in November 2010 and was sentenced to 18 months' imprisonment, later reduced after an appeal to nine months' home detention.

National Finance invested deposits from the public mainly into car loans, through a network of dealers fo the related Payless Cars group.

It was placed into receivership in May 2006.

Some debenture holders have been returned about 49c in the dollar.