Company director in SFO probe

Nubiotics marketed a range of colostrum-based cosmetics, active manuka honey and infant formula accompanied by impressive-sounding health and scientific claims. File photo / NZME.

Investigation into manuka honey and infant formula exporter owing over $1m.

The Serious Fraud Office is investigating an exporter of infant milk powder and manuka honey that receivers say collapsed owing more than $1 million.

Nubiotics, owned and directed by Waikato businessman Trevor Lock, entered receivership and liquidation in August last year after falling behind on payments to boutique lender Waikawau Finance.

Nubiotics marketed a range of colostrum-based cosmetics, active manuka honey and infant formula accompanied by impressive-sounding health and scientific claims.

Lock, 54, is described in company literature as having a masters degree in biotechnology and bio-engineering from Waikato University and formerly employed by Anchor as a nutraceuticals development manager. Reports prepared by receiver McDonald Vague show the company had been accepting deposits to provide products, but "had failed to complete" the agreements.

The company's main asset was listed as $5.1 million of trade debtors, but on further investigation this number rapidly shrank.

"The director initially advised that the cashbook was incorrect, and there was only one debtor who owed $363,314, and that the balance related to contracts that had not been commenced or been completed. He subsequently advised that the remaining balance was irrecoverable, confirming that no supply had been made to the associated debtor," McDonald Vague's first report into Nubiotics said.

Financing statements filed with the companies office show the $400,000 loan from Waikawau was secured against accounts receivable.

Waikawau director Sharon Connolly, who owns the boutique financier with her husband, said the loan made in March 2014 was intended to be short-term and its defaulting was part of the reason her company had moved out of lending and into property development.

"It was supposed to be only for four weeks, but 18 months later we're still in court with him trying to get paid," she said.

She said Lock made various excuses as to why his debtors weren't paying up - first that produce was stuck on the wharf in Tauranga, then China - but it was later revealed these excuses were hollow.

Connolly said they were pursuing Lock in bankruptcy proceedings - the next hearing will be in the High Court at Hamilton on November 2 - in order to protect the public. "We're never going to see our costs back from it - or our original capital back from him," she said.

The Herald has spoken to a number of Nubiotics customers based in New Zealand, Australia and further abroad - owed nearly $800,000 in total - who told a similar tale of incomplete contracts following agreements to export infant milk formula for sale in China. They said Lock's repeated stories promising delivery of the product or refunds of deposits - ranging from imminent logging contracts in India to honey sales in Egypt - repeatedly fell through.

A spokesperson for the Serious Fraud Office confirmed the white-collar crime agency was investigating the case, but there was no further comment as the case was still active.

Receiver Jared Booth of McDonald Vague said there would be a considerable shortfall to creditors, but proceeds from the sale of Lock's home were still to be distributed.

Lock did not return calls or emails, and his residence in Morrinsville was recently sold by receivers. The four- bedroom property sold for $392,000 at auction in August, but mortgages and prior charges will see less than $100,000 made available to Nubiotics creditors.

Since Nubiotics collapsed, Lock has registered two new entities with the companies office, Central Brokers and Oak On Elm Holdings. According to information provided to the companies office these companies, respectively, provide mortgaging broking and management consultancy services.