Accused Bridgecorp directors Rod Petricevic and Rob Roest attended meetings in the lead-up to the finance company's collapse discussing the excuses staff should give investors when payments were late, a court heard yesterday.
Petricevic, Roest and fellow director Peter Steigrad each face 10 Securities Act charges of making untrue statementsin the offer documents of Bridgecorp and Bridgecorp Investments. The three deny the allegations in a High Court trial that is expected to take until March. Former directors Gary Urwin and Bruce Davidson have pleaded guilty to the charges.
Including the Securities Act allegations, Petricevic and Roest face eight charges under the Crimes Act and Companies Act of knowingly making false statements in offering documents that Bridgecorp had never missed interest payments to investors, nor repayments of principal.
The Financial Markets Authority presented evidence this week alleging the company began defaulting on payments in February 2007.
According to Petricevic's lawyer, Charles Cato, Bridgecorp's former managing director was only informed of the defaults just before the company collapsed in July of that year owing $459 million to 14,500 investors. But a former Bridgecorp manager, Kevin Stephens, gave testimony yesterday alleging Petricevic and Roest were present at meetings from May 2007 discussing late investor payments.
The directors also attended discussions deciding which investors should be paid first and what staff should tell those who phoned asking where their money was, Mr Stephens said. "Excuses were there was a computer glitch, that they'd be paid the next day," he said. Investors who called up demanding their money would tend to get paid first, he said.
Another former employee, Joanne Tait, said Petricevic asked her in April 2007 to take calls from unpaid investors. She later learned the company's regular phone staff had refused to answer the phones.
