The founder of a group seeking to hold shonky finance companies to account says the lengthy jail sentence for Bridgecorp director Rod Petricevic will send a clear message to the finance sector.
Petricevic, 62, was jailed for six and a half years in the High Court in Auckland on Thursday after being found guilty of 18 charges of misleading investors in the period between December 2006 and Bridgecorp's receivership in July 2007.
Justice Geoffrey Venning said Petricevic knew statements that the company had never missed principal or interest payments were wrong.
He said more than $91 million of reinvested funds and $28 million of new money was invested after misleading statements were published.
Suzanne Edmonds, who founded Exposing Unacceptable Financial Advice in the wake of the Bridgecorp collapse, said Bridgecorp's offending was up with the worst among the failed finance companies.
"The people at the helm were actually aware of what was happening and so they deceived the people who trusted them," she said outside court on Thursday.
"I think this sets quite a precedent and will send a very clear message to anybody that wants to commit fraud in the future."
Justice Venning relayed details of two people who invested hundreds of thousands of dollars in Bridgecorp after some of the misleading statements were published. They lost their retirement savings as a result.
Ms Edmonds said the stories were mild compared to what she'd heard.
"People have lost their homes."
Prosecutor Brian Dickey said the Bridgecorp case was the most serious to date because there were overt lies about missed payments. Those who asked were told that there was a computer glitch.
"If people knew that you were actually not paying back the last group of investors when you're putting your money in, it's hard to imagine that any money would have come in," he said.
Petricevic's lawyer Charles Cato would not comment on the possibility of an appeal after the sentencing.
Bridgecorp collapsed in July 2007 owing $459 million to 14,500 debenture investors and $21 million to capital note investors.
Fellow directors Rob Roest, found guilty of the same charges as Petricevic, and Peter Steigrad, found guilty of six Securities Act charges will be sentenced on May 18.Another director, Gary Urwin, sentenced to two years in jail after pleading guilty to misleading investors, is to appeal his sentence, while former chairman Bruce Davidson was sentenced last October to home detention and ordered to pay $500,000 in reparation.
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