28 Jun 2012

Court rules director reparation to go to Nathans receivers

12:16 pm on 28 June 2012

The High Court in Wellington has ruled that nearly $900,000 in reparation from convicted Nathans Finance directors should be paid to the company's receivers.

Kenneth Moses, Mervyn Doolan and Donald Young were convicted last year on five charges and ordered to pay reparation of $425,000, $150,000 and $310,000 respectively.

The Crown argued for the $885,000 to be paid to those directly affected and who invested or reinvested money on or after the prospectus was issued in December 2006.

It argued that Nathans was not a person who suffered harm, loss or damage.

But the court has decided the money should be paid to the receivers so that it can be used for the benefit of everyone who last lost money, not just those who invested on the basis of the December 2006 prospectus.

Moses and Doolan were sentenced to more than two years in jail for misleading investors about the risks associated with investing in Nathans Finance, which collapsed in 2007 owing $174 million to 7000 investors. Young received nine months home detention.

Another director, Mark Hotchin, pleaded guilty to three charges and was ordered to pay $200,000 in reparations. That money was to go to Nathans' receivers.