Anthony Bowden. Photo / Greg Bowker
A former director of the failed Five Star Group has applied to get two criminal charges thrown out of the High Court.
Anthony Bowden faces nine counts under the Crimes Act for theft by a person in a special relationship.
His associate, Neill Williams, who was a de-facto Five Star director, also faces criminal charges.
The pair have pleaded not guilty and their trial is due to start in the High Court at Auckland in June 2012.
It is expected to take up to four weeks.
Five Star marketed itself as a low or modest risk finance entity which made small consumer loans for clients to make household purchases such as fridges.
Instead, it was allegedly investing large sums in complex commercial and related party loans - totaling more than $50 million. In 2007, Five Star Consumer Finance collapsed with losses of $42 million. Other companies in the group, Five Star Finance and Five Star Debenture Nominee, owe another $43 million.
The Crown argue company directors knowingly advanced millions of dollars from Five Star Consumer Finance to other entities they were also in charge of.
But in a pre-trial application this morning, Bowden's lawyer Todd Simmonds argued two of the nine counts against the former director should be discharged.
He queried if there was sufficient evidence to show Bowden was actually in control of funds the two counts relate to.
The funds in question were allegedly involved in 14 related-party loans.
Simmonds conceded Bowden had personally approved one of the loans and had been present at board meetings when other advances were discussed or signed off.
However, Simmonds said this alone was not enough evidence to establish that Bowden exercised control and said his involvement was so limited it did not satisfy relevant sections of the Crimes Act.
This was rejected by Crown lawyer John Billington QC, who argued the evidence reached the threshold required.
Justice Patricia Courtney reserved her decision on whether the two counts should stay.
Bowden's fellow Five Star directors - Marcus MacDonald and Nicholas Kirk - pleaded guilty last year in the Auckland District Court to charges brought by the SFO of theft by a person in a special relationship. The pair also pleaded guilty to Securities Act charges.
Kirk was sentenced to two years and eight months' in jail and MacDonald to two years and three months'.
Bowden pleaded guilty to Securities Act charges and was sentenced to nine months' home detention.
Williams had originally pleaded guilty to charges under the Securities Act but is making a bid to reverse this.
The Crown opposes his application, which is due to go to court next month.
Reserve Bank says leaving banks to their own devices hasn't worked.