A colleague of Rod Petricevic and former director of failed finance company Bridgecorp has been bailed to a home in North Sydney after pleading guilty to 10 charges.
Gary Kenneth Urwin is waiting at his son's modest Sydney property to be sentenced next month and could face jail.
Urwin pleaded guilty at the High Court at Auckland yesterday to 10 charges of making untrue statements in the offer documents of Bridgecorp and Bridgecorp Investments.
Bridgecorp collapsed in 2007 owing $459 million to 14,500 investors.
During yesterday's brief appearance, Urwin's lawyer, David Reece, asked for a home detention report to be prepared.
But Crown prosecutor Brian Dickey said the Crown would oppose home detention.
"We will be seeking a term of imprisonment at sentencing."
The breaches of the Securities Act have a maximum penalty of five years' jail or a fine of up to $300,000.
Urwin had been on trial with the three other Bridgecorp directors, Petricevic, Rob Roest and Peter Steigrad.
The trial began last month.
Mr Dickey told the court Urwin and others must have known about Bridgecorp's deteriorating finances.
He told the court the directors lied to prospective investors in Bridgecorp's term investment prospectuses, registered on December 21, 2006. The prospectuses reported Bridgecorp's financial position for the year ended June 30, 2006.
He said reinvestment and new investments had declined, the company's costs had increased, and market conditions had worsened.
By failing to state this in offer documents, the directors had misled investors, he told the court.
An extension certificate, dated March 30, 2007, said the company's financial position had not adversely changed from the statement in the prospectuses.
But Mr Dickey said that was not the case and all the directors knew about it.
The company's liquidity had declined and it had failed to meet its cashflow forecasts.
The information was emailed to all directors and it "ought to have been apparent to the directors that Bridgecorp had insufficient cashflows to continue operating as a finance company".
The trial adjourned last month and will re-open next Monday. It is set down to run until the court closes for the year and will begin again on January 23. It is likely to run until March.
Outside court, Mr Urwin said he had no comment to make until after sentencing.
Asked what he planned to do in Sydney, his lawyer Mr Reece said Urwin needed to "tidy up his personal affairs".
Mr Reece said his client regretted the demise of the company.
"He certainly wasn't working for its demise."
Mr Reece said his client was particularly committed to making the Fiji resort development at Momi Bay work but the military coup in 2006 "had a significant effect".
"He's got some strong mitigating factors which will be brought out at sentencing."
Urwin, a member of the New Zealand Institute of Chartered Accountants, would now face a disciplinary hearing, an institute spokesman said.
Last month, former Bridgecorp chairman Bruce Davidson pleaded guilty to misleading investors. He was sentenced to nine months' home detention and ordered to pay reparations of $500,000, which will be distributed to investors.
