A witness for the defence of three former South Canterbury Finance directors has heaped praise on the defendants and lambasted the late Allan Hubbard.
Former chief executive Lachie McLeod and former directors Edward Sullivan and Robert White are defending 18 fraud charges relating to the $1.7 billion collapse of the company in 2010.
The company had been accepted into the Crown Retail Deposit Guarantee Scheme during the 2008 global financial crisis. The Government ended up paying $1.6 billion to its depositors in 2010.
From left: Edward Sullivan, Robert White and Lachie McLeod. Photo: Mytchall Bransgrove
The 52nd day of New Zealand's largest fraud trial has heard that at the time of its entry into the scheme, the South Canterbury Finance board was becoming increasingly concerned about Mr Hubbard's business practices.
Former chief financial officer Graeme Brown was giving evidence at the trial in the Timaru High Court on Thursday after fraud charges against him were dropped.
Mr Brown said Allan Hubbard called Mr White 'Handbrake Bob' because he often tried to rein in Mr Hubbard's behaviour.
He said Mr Hubbard circumvented those who disagreed with him or challenged him, and ignored everyone equally.
Mr Brown said that in the three years he worked for the company, he formed the view that Robert White was a man of integrity and honesty.
Allan Hubbard died following a car crash near Oamaru in 2011.
The court on Thursday was shown a strongly worded letter from the Bank of New Zealand demanding that South Canterbury Finance stop making public statements about credit facilities it didn't actually have.
The letter from the BNZ stated that in 2009, South Canterbury Finance was continuing to state publicly that it had $150 million of loan facilities from two banks. It said the banks were not happy these incorrect statements were being made and wished to know what the company was going to do about it.
In response to defence lawyer Marc Corlett, Graeme Brown said he could not remember if he took any steps to check if any notification was needed.
The Crown began its cross-examination on Thursday.
Mr Brown told lawyer Jonathan Eaton, QC, that defendant Lachie McLeod was no expert in financial accounting.
However, under cross-examination, he told Colin Curruthers, QC, that as chief executive Mr McLeod was involved in all aspects of the company's finances.
Mr Brown said he formed the view that Robert White was a man of integrity and honesty.
