Financial commentators have weighed in on calls that Sir Douglas Graham should have his knighthood stripped following today's convictions.
Sir Douglas Graham and three other directors of Lombard finance were found guilty of four charges of making false statements, which meant investors were not aware of the company's cash flow problems.
Lombard's chief executive Michael Reeves, former justice minister Bill Jeffries and former royal press secretary Laurie Bryant were also convicted.
Bernard Hickey, editor of interest.co.nz, said on TVNZ's Close Up programme that thousands of investors have lost confidence in the New Zealand finance system and want to see justice done.
"Even though they [the directors] have high-priced lawyers and supporters in high places, [they need to] actually pay the price," said Hickey.
He said stripping the former justice minister of his knighthood was a "perfectly reasonable thing to look at".
Last month the Queen stripped Fred Goodwin of his knighthood. Goodwin was in charge of the Bank of Scotland when it collapsed, around the same time Lombard went under.
Hickey said people employed on a board of directors have a responsibility to act as guardians for the money investors put into the company.
"Particularly if your name is the one that's brought in investors, and that's certainly the case here with the directors in Lombard, then you should take responsibility," he said.
"That's the point of being a director. That's why you get paid all that money."
High profiles
Exposing Unacceptable Financial Activities (EUFA) co-ordinator Suzanne Edmonds said the four directors should have been "digging deeper and doing a bit more work".
"The reality is that they were possibly chosen for those positions for their high profiles, and they didn't turn it down because it was obviously a bit of a glory job," Edmonds told Close Up.
She said she has no sympathy for Sir Douglas, who is losing his own pension.
"At the end of the day he would have had to have known what state that company was in if he was a true director of a company."
Edmonds said the Prime Minister should look at removing Sir Douglas' knighthood as soon as he can.
Outside the courtroom today Sir Douglas left questions about his knighthood to his lawyer, Paul Davidson who said "that's a matter that Sir Douglas will consider himself".
Convicted under the Securities Act, the four men now face fines of up to $300,000, or jail terms of up to five years.
The Crown wants jail terms but Justice Robert Dobson said the crimes might not be serious enough to warrant imprisonment.
"I have in mind some forms of community-based sentence and financial penalties," said Dobson.
Jeffries plans to appeal the High Court judgement that found him guilty of making untrue statements as a director of Lombard Finance.
Lombard Finance was put into receivership in April 2008, owing $125 million to 4400 investors. Secured creditors were expected to be repaid less than 24 cents in the dollar.
The trial ran before Justice Robert Dobson from October 18 last year to February 2.
The charges:
Count one: Between December 24 2007 and April 3 2008 Authorised Reeves to sign on behalf of the defendants a registered prospectus that was distributed and included an untrue statement. The amended prospectus omitted significant adverse liquidity issues, including the company's deteriorating cash position since September 30 2007.
Count two: Distributed an advertisement that included an untrue statement relating to investment opportunities in unsecured subordinated notes dated December 28 2007.
Count three: Distributed an advertisement that included an untrue statement relating to investment opportunities in unsecured subordinated capital notes dated December 28 2007.
Count four: Distributed an advertisement that included and untrue statement relating to investment opportunities in secured debenture stock dated December 28 2007.
They were found not guilty in the fifth count of distributing an advertisement that included an untrue statement by sending a letter to investors on or about March 3 2008 enclosing a DVD that included and untrue statement.
