The Serious Fraud Office yesterday laid a total 93 charges under the Crimes Act against four directors involved in two separate companies - involving almost $30 million in investor funds or loans.
The SFO has levelled 87 charges against a pair of co-directors over allegations they defrauded about 85 investors of $15 million.
Michael John Bradley and Jacqueline Lyndsay Bradley, the co-directors of B'On Financial Services Ltd (B'On) in Auckland, face charges under the Crimes Act - 28 of dishonestly using a document and 59 charges of theft by a person required to account and theft in a special relationship.
In the second investigation, the SFO yesterday arrested and laid six charges under the Crimes Act against one director and one former director of Capital + Merchant Finance Ltd, involving nearly $14.5 million of related party lending dating back to 2002.
The accused are Neal Medhurst Nicholls (55) and Wayne Leslie Douglas (57).
When Capital + Merchant was placed into receivership in November 2007, the company owed $167.1 million to about 7000 investors before being placed in liquidation in December last year.
The SFO said the charges were over loans of about $14.5 million made between April 2002 and September 2004 to three companies which converted two Palmerston North high-rise office blocks into student accommodation.
SFO chief executive Adam Feeley said the charges relate to one "discrete set of transactions", but it was continuing to investigate other transactions.
The men were remanded on bail to next appear on December 16.
The charges against the Bradleys come a day after Mr Feeley was reported to have told MPs at a select committee hearing that he expected to be laying fraud charges within 24 hours in what was described as a Ponzi-type scheme.
"The case is alleged that B'On took investors' money to repay earlier investors, and also to fund the lifestyle of the defendants," Mr Feeley said in a statement yesterday.
The SFO's investigation identified more than 85 investors, but the 87 charges relate to 24 investors who were involved with B'On between 2003 and 2009.
In a statement on B'On in October, the SFO said B'On was placed in voluntary receivership in December 2009 owing about $29 million to 86 investors, prompting an SFO investigation to begin in January.
It was concluded in October.
Liquidators of B'On and four other related companies said in a statement in February they had not found adequate financial and accounting records consistent with with the activities of a financial planner and "the location or existence of the invested funds has yet to be ascertained".
Mr Feeley yesterday said, "Anyone contemplating investing their hard-earned money should understand the risks that are attached to any form of investment.
"However, it is also reasonable that New Zealanders can expect that any investment scheme is run honestly, and that their money is used in the manner promised."
The Bradleys were remanded on bail to appear on January 13.
Fraud complaints
SFO work in first quarter 2010-11.
• 167 complaints received.
• 19 cases under investigation.
• $626 million of alleged fraud under investigation.
• Eight charged with fraud.
• 219 charges of fraud laid.
• 32 cases being prosecuted.
> Crimes Act charges laid against people involved in finance companies include National Finance, Bridgecorp, Five Star Finance and Capital + Merchant.
SOURCE: SFO website
