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The Serious Fraud Office has refused to comment on why it failed to use former Treasury Secretary John Whitehead as a witness in the South Canterbury Finance case.
Two of the accused - former SCF chief executive Lachie McLeod and former director Robert White - were cleared of any wrong-doing this week while former director Ed Sullivan is now out on bail pending sentencing next month after being found guilty on five of nine charges he faced.
All three were found not guilty on what Justice Paul Heath said was one of the most serious allegations - that they gave false information about the extent of related party transactions in order to get the company into the Crown retail deposit guarantee scheme. When SCF - once New Zealand's largest finance company - went under, the guarantee was triggered with the Crown paying out $1.58 billion, of which only $800 million had been recovered.
Treasury Secretary John Whitehead made the decision to allow SCF to enter the guarantee scheme and the Crown deliberately decided not to call him to give evidence during the five-month trial. When asked why not, the SFO said today decisions as to which witnesses to interview were informed by a wide range of factors. It wouldn't comment further about specific decisions made in the course of the SCF investigation and prosecution, it said.
In his written judgment, Justice Heath said while he suspected it was "very likely that a decision would have been deferred" if more information had been provided, he couldn't exclude the reasonable possibility the Secretary would have signed the guarantee deed in November 2008, irrespective of what they were told because of concern over the impact on public confidence if it failed.
(BusinessDesk)
Fiona Rotherham
Sat, 18 Oct 2014
Sat, 18 Oct 2014
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SFO won't comment on why Treasury witness not used in South Canterbury Finance trial
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