Three businessmen found guilty of one of New Zealand's worst finance company frauds have been jailed, with the judge calling them greedy and lacking commercial morality.
Former directors of failed finance company Capital + Merchant Neal Nicholls, Wayne Douglas and Owen Tallentire appeared in the Auckland High Court on Friday.
The Serious Fraud Office has said the men engaged in deeply cynical transactions, fooling 7500 debenture holders, who lost everything. In November 2007, Capital + Merchant collapsed, owing $167 million.
Nicholls and Douglas were previously found guilty of three charges of theft by a person in a special relationship, while Tallentire, the former chief executive, was found guilty of two counts of this charge.
On Friday, Nicholls and Douglas were each jailed for seven-and-a-half years, while Tallentire got five years.
The men had put through transactions that breached terms of Capital + Merchant's trust deed and benefited from trusts they controlled.
In sentencing, Justice Wylie said they were greedy, lacked commercial morality and their behaviour had brought the finance industry into disrepute.
Crown prosecutor Nick Davidson told the court the company had been living a lie and the trio had showed a wholesale disregard for their obligations as directors in favour of their own interests.
The Crown had sought jail terms for all men, while the defence had asked for home detention.
Outside court, Mr Davidson said the sentences match the seriousness of the crime. "The investing public needs the assurance ... People actually pay a real penalty with this sort of offending. It's huge money, the losses are huge, the victim impact reports are absolutely harrowing."
Mr Davidson told Radio New Zealand's Checkpoint programme the Crown's position was that these were serious offences of theft.
"It is a high level in terms of the amount that's stolen - a total of $19 million across three counts for two of the accused and $12 million for the other accused - so it's right up there in terms of value.
"But I think the influencing factor for the judge was the extent of the effect on the investing community in cases such as this."
Up until now, the stiffest punishment for finance company directors has been handed out to Bridgecorp's Rod Petricevic and Rob Roest, who each got six-and-half years' jail. Bridgecorp collapsed in 2007, owing more $459 million to 14,500 investors.