KEY POINTS:
Bridgecorp's top brass will be checking the extent of their directors' insurance cover as receivers of the failed trans-tasman finance group compare notes on whether the methods used to try to stave off insolvency went too far.
Bridgecorp is chaired by high-profile Auckland lawyer and director Bruce Davidson. Other directors include managing director Rod Petricevic, Rod Roest, Gary Urwin and Peter Steigrad. A further director, Eric O'Sullivan, (no relation) stepped down before the crash.
Their first step should be to get the receiver of the Australian arm to shut down its website. At 6pm (NZT) yesterday, the website was still promoting itself to investors and urging property dealers to approach it for 100 per cent finance.
The website quoted Rod Petricevic: "Bridgecorp is a company with a commitment to excellence. If you are an investor or borrower, you will not be disappointed."
For "Rocking Rod" - who earned his moniker during the adrenalin-filled 1980s sharemarket boom - the fact that his name was still up in lights after his latest flagship had been put into receivership would be another humiliation. Petricevic, who had been demanding journalists put questions to him in writing leading up to the collapse, has not fronted publicly since PriceWaterhouseCoopers was appointed as New Zealand receiver on Monday.
Charitably, he may be feeling utterly defeated after having failed to negotiate a survival path through the impending morass. But the image that will stick in investors' minds comes from reports that he was last seen quaffing champagne in Valencia after Team NZ won the Louis Vuitton Cup.
The receivership was no surprise to those in the know, nor to the financial journalists who had run into brick walls trying to get Petricevic to front up with clear responses to questions on some worrying investments as the rumour mill threw up bad news..
What is a surprise is the detail emerging over the inter-company transactions and loans that appear to have been used to prop up the group's Australian finance arm after regulators stopped it from tapping the market for more funds - and the transfer of some funds back across the Tasman in the group's final weeks.
Most of the detail that has so far emerged has come from Australia, where insolvency expert Ferrier Hodgson was appointed receiver of Bridgecorp Finance by the company's trustee, Permanent Nominees, after the New Zealand company's failure to meet loan repayments caused a domino effect, which brought the solvency of the entire group into question.
Regulators will be asking whether the sale of A$60 million (NZ$65.7 million) of loans by the troubled Sydney arm of the group to its New Zealand sister company last year was done at an arms-length basis - or whether the sale price was inflated beyond the point of rational commerciality as part of a desperate move to keep the Australian operation afloat.
If the latter, this could mean the transaction imperiled the finances of the New Zealand arm, putting at risk the savings of Bridgecorp's mum and dad investors.
New Zealand investors will also want to know more about the A$15 million of equity and debt that was injected into the Australian arm after that country's securities watchdog blocked it from soliciting more cash from the public.
Similarly, the Australian investors will want to know more about the transfer to New Zealand of A$3.5 million from Bridgecorp Finance in group's dying weeks.
Already there are suggestions that the New Zealand Registrar of Companies will take an independent look into the myriad inter-company transactions.
It is too soon to say whether the deals at the heart of the hand-holding operation breached the limits the various trust deeds, but if they did there will be ramifications for years to come.
