KEY POINTS:
Criminal charges laid against Bridgecorp and two of its directors, including founder Rod Petrecevic, are the first of a series of Companies Office legal actions against failed finance companies to be announced over coming weeks, the Business Herald understands.
The office yesterday confirmed it had laid charges against Bridgecorp and directors Petricevic and Robert Roest.
The confirmation came as Bridgecorp's receivers said they were now trying to recover Petricevic's assets.
Registrar of Companies Neville Harris said: "The charges relate to statements made in the company's prospectus, and in a directors' certificate,"
Bridgecorp's prospectus and its directors claimed the company had never missed an interest or principal payment.
"In fact, between February and June 2007, Bridgecorp failed to make many of its required interest payments and investment redemptions by the due dates," said Harris.
The prosecution is being carried out by the National Enforcement Unit of the Companies Office and the defendants will appear in the District Court at Auckland on July 29.
If convicted on the Securities Act charges they face, Bridgecorp, Petricevic and Roest may be fined up to $300,000 while the Companies Act charges faced by Petricevic and Roest carry maximum fines of $200,000 or jail terms of up to five years.
Separate investigations into Bridgecorp's affairs are being conducted by the Securities Commission and the Serious Fraud Office and Harris said the three agencies have been "liaising closely as appropriate".
A source familiar with these investigations told the Business Herald the National Enforcement Unit was understood to have been "very busy" preparing legal action against other failed finance companies and more announcements were likely in the next month or two.
The Companies Office, the Securities Commission, Serious Fraud Office and even Commerce Minister Lianne Dalziel have faced considerable criticism for a perceived lack of action against the directors of failed finance companies who many investors believe mismanaged their funds.
But with yesterday's Companies Office announcement, all three agencies have now moved to assure investors they are taking action.
Meanwhile, Bridgecorp's receiver, John Waller of PricewaterhouseCoopers yesterday confirmed he and colleague Colin McCloy were now targeting property belonging to Petricevic. "We are actively now pursuing assets where we believe he owns them under his own name."
The moves to recover assets from Petricevic follows a High Court ruling early this month that he should repay $651,861 in personal income tax which Bridgecorp had paid on his behalf two years ago.
Waller said he and McCloy had "a number of other actions we're looking at ". He also said another estimate of eventual returns to Bridgecorp's 14,500 investors was likely by the end of the month.
In April, Waller and McCloy slashed the estimated payout from a range of 19c-63c in the dollar to 16c-51c.
Bridgecorp went into receivership in July last year, owing about $460 million.
THE CHARGES
* Bridgecorp Ltd faces one charge under the Securities Act. The company is charged with allotting debenture stock to members of the public knowing that its prospectus was false. The prospectus claimed Bridgecorp had never missed an interest payment or, when due, a principal repayment.
* Bridgecorp's two executive directors, Rod Petricevic and Robert Roest, each face two charges under the Securities Act. One charge is in relation to debenture stock and the other charge is in relation to capital notes.
* Petricevic and Roest also face one charge each under the Companies Act. They are charged with making a false statement to the trustee for the debenture holders when they signed a directors' certificate on 30 April 2007.
THE PENALTIES
* The Securities Act charges carry a maximum fine of $300,000.
* The Companies Act charges carry maximum fines of $200,000 or jail terms of up to five years.
