High Court dismisses Crown’s appeal for tougher sentence on businessman Mark Brewer

The Auckland High Court has dismissed the Crown’s appeal for a tougher sentence on businessman Mark Brewer for running a company while bankrupt.

Last year Mr Brewer pleaded guilty to a breach of the Insolvency Act relating to his management of Intervest Global (NZ) while he was bankrupt. The company sold horse betting software and is now in liquidation.

In October, Judge Stephen O'Driscoll ordered him to pay a $5000 fine and $190,000 in reparations to liquidators of Intervest for losses incurred while he was managing the company.

The Crown originally sought up to 10 months of jail, but after mitigating factors, including the guilty plea and reparations, prosecutors then sought home detention.

Mr Brewer avoided both with the promise to pay full reparation, which his associate David McEwen promised to loan him during the sentencing hearing. 

This week at the High Court, the Ministry of Business, Innovation and Employment sought to appeal the sentence, saying it is too light to act as a deterrent and sends a message that money can get convicted criminals reduced sentences.

Justice John Fogarty disagreed, dismissing the appeal and saying the District Court did not err in principle when ordering the sentence.

At sentencing, Mr McEwen agreed to lend $195,000 to Mr Brewer for the full reparations and fine if he was not subject to home detention, which would allow him to work overseas.

Mr Brewer, who was not in court this week, has moved to Ireland to work for another startup, Paymark Autotrader, with Mr McEwen. 

Mr Brewer is a self-described “sales legend” at Phoenix Forex, which distributed a foreign exchange software system. The Financial Markets Authority issued a warning about the company in late August.

The company is owned by Phoenix Group Ventures, which is co-owned by Mr McEwen and Kendall Twigden, Mr Brewer’s girlfriend. Phoenix Forex went into liquidation two days after Mr Brewer’s sentence.

Mr McEwen says if Mr Brewer were forced to come home and serve a community-based sentence, the new Irish business venture would likely fail.

“If this sentence is overturned and the reparation order withdrawn, the funder faces not only loss of the amount he has already advanced, but also the risk of losing the investment he has made in Ireland in the new business,” Justice Fogarty says in his decision.

Mr McEwen had already advanced $130,000 in reparations to the liquidators of Intervest and the $5000 fine. He stopped payments on the additional $60,000, waiting for the outcome of the appeal.

sflores@nbr.co.nz