Sir Douglas Graham, a director of the failed Lombard Finance, has admitted he knew the company was vulnerable, but was confident it would survive.
Lombard Finance collapsed in April 2008, owing $127 million to thousands of investors.
Sir Douglas is a former justice minister and one of four directors facing charges in the Wellington High Court.
The others are Michael Reeves, Lawrence Bryant and another former justice minister William Jeffries.
They are accused of making false statements in offer documents issued in 2007 and 2008 and of misleading investors.
Their trial continued on Wednesday, with the court listening to a recording of Sir Douglas being interviewed by Michelle Peden, a forensic accountant investigating the case for the Serious Fraud Office.
In that recording, Sir Douglas admitted he was worried about Lombard Finance's dwindling cash reserve, but had confidence in the advice of his management team who told him things would soon get better.
