Broker’s collapse sees chief arrested

The man at the centre of the Access Brokerage collapse, Peter Marshall, is facing charges for false accounting which carry a maximum penalty of 10 years in prison.

Marshall - former chief executive of the Wellington-based broking firm that went into liquidation last September - was arrested by the Serious Fraud Office (SFO) yesterday morning and charged with 13 counts of false accounting and two of making a false statement.

He appeared in the Wellington District Court at 2.15pm and was remanded at large until July 11. He has surrendered his passport.

Financial penalties may also be imposed if he is found guilty.

Marshall's lawyer, Lance Pratley, said he had "no comment to make at this time".

SFO director David Bradshaw said the charges arose from the "accounting entries and liquidity reports that it is alleged disguised the true financial position of Access Brokerage over several years".

No one else is being charged and Bradshaw said he would not be commenting further as the matter was now before the courts.

He noted his probe was to identify criminal offending and was separate from the NZX review into possible breaches of its rules.

NZX spokeswoman Rowan Macrae said the exchange's inspection process was not designed to pick up fraud.

"It is for where a firm may be non-compliant with our rules," she said.

"The SFO has obviously done a comprehensive and detailed investigation."

The NZX has brought disciplinary charges against Access and Marshall for rule breaches and the Securities Commission is also investigating - particularly in relation to the broking firm's banking arrangements.

Access, owned by former Olympic Committee head Bill Garlick, went into liquidation on September 6 last year after a $5 million deficit in client funds was uncovered.

Speaking from his Wairarapa home yesterday, Garlick said he was no longer in contact with Marshall and that it would be inappropriate for him to comment.

Asked how he thought Marshall would be coping, Garlick said: "It wouldn't be easy for anybody".

Marshall, who is believed to come from Hawkes Bay, lives in Silverstream, Wellington. His questioning over Access was delayed for several months due to ill health, he had heart surgery last year.

Reports from liquidators Ferrier Hodgson say the company had suffered accounting discrepancies dating back to at least June 1998. They say, among other things, that expenses were understated and assets overstated in the firm's ledgers and management accounts.

Liquidators Michael Stiassny and Brendan Gibson, of Ferrier Hodgson, are still pondering whether to pursue legal action of their own.

"We are still working through things but we are getting close. We'll probably come to a decision in the next couple of weeks," Gibson said.

Any legal action they took would be against the NZX for failing to pick up the discrepancies earlier.

The liquidators' initial report, released in September, showed the firm had been using client funds to run the company for some time, creating a shortfall in its client trust account.

Thousands of Access clients were bailed after the Bank of New Zealand and NZX underwrote the shortfall on the firm's trust account.

The background

* Access went into liquidation on September 6, 2004, after a $5 million deficit in client funds was uncovered.
* Thousands of Access clients were bailed after the Bank of New Zealand and NZX underwrote the shortfall on the firm's trust account.
* The liquidators' initial report showed the firm had been using client funds to run the company for some time - creating a shortfall in the trust account.