15 Oct 2014

Acquitted CEO reflects on SCF trial

10:54 am on 15 October 2014

The late Allan Hubbard was an astute man with an empire, and everyone looked up to him, former South Canterbury Finance (SCF) chief executive Lachie McLeod says.

Lachie McLeod outside High Court in Timaru.

Lachie McLeod outside High Court in Timaru. Photo: RNZ / Patrick Phelps

Mr McLeod was found not guilty of five fraud charges relating to the 2010 collapse of SCF.

Co-accused Bob White, a former director, was cleared of the four charges he faced, while fellow former director Edward Sullivan was found guilty of five of the nine charges brought against him.

Mr McLeod said it had been four long years since the SFO investigation into the company's collapse began, and that no one would ever understand what he had been through.

He said it was all very well to say he might have done things differently but, when he joined SCF, he thought he was making the right decision.

"I had a chance, I suppose, to either stay in farming or go rugby refereeing and maybe I could have stayed rugby refereeing," he said.

"But I'd done the rural farming thing for 12 years, and it was a time for me to change. Allan Hubbard was an astute guy. He had an empire. Everyone looked up to him.

"It was an opportunity of a lifetime."

'Iron fist'

He soon found Mr Hubbard "controlled it with an iron fist" and had a certain way of doing things.

"We just sort of [deferred] to him because the fact is he was the guru ... and everybody respected him.

"He was a guy who was very hard to stand up to, and what he said was done, and that's how it was."

However, Mr McLeod said he would not speak ill of him, and that he had done a lot of good in the community.

"A lot of people out there would ... bag Allan but I certainly won't be. I've learned a hell of a lot from him."

Mr McLeod said the past four years would have been even harder without the support he had received.

"The wife and, I've got two daughters, and close mates, it's been great. And my parents too, they came down as many times as they could. The support from them and the siblings. It's been great.

"And that's probably the way you pick yourself up, and you have some bad days. The great thing here is, we've got a little block of 100 acres, and every morning I wander out with the dogs and think of things differently."

Mr McLeod said the trial had not just taken an emotional toll; he had had to borrow a lot of money from the bank to pay his legal fees.

Jonathan Eaton, QC, left, and Lachie McLeod.

Jonathan Eaton, QC, left, and Lachie McLeod. Photo: RNZ / Nicola Grigg

His lawyer, Jonathan Eaton, QC, said the trial had ruined the lives of innocent men.

Mr Eaton would not say whether he believed the charges should have been laid but said the actions of the SFO in the investigation should be examined.

"We'll have to go through the judgement...there's a lengthy judgement which should be available, and dissect each of the transactions, and we'll look at it," he said.

"I mean obviously, from our perspective, we've always said there were serious failings in the investigation and the quality of the evidence, and that will no doubt be visited at some later stage.

SFO bias claim

Forensic investigator Gib Beattie, who reviewed the SFO's case for the defendants, said it was inadequate and biased.

"They were simply looking for evidence to support their theory of a fraud, rather than as gathering all the information from which to make an assessment if there was fraud," he told Morning Report.

Both Mr McLeod and Mr White said they would stand by Sullivan, with Mr McLeod saying he always had good intentions.

These words were echoed Timaru local Graeme Calvert, who has been following the trial.

"The judge has found Edward Sullivan guilty of really just trying to do the best for the clients and for the firm. There was no personal gain for him at all in any of his actions," Mr Calvert said.

Sullivan will be sentenced in December, while Mr McLeod has not ruled out seeking legal costs from the Crown.

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