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Sympathy for investors after Bridgecorp trio convicted

Published: 5:58AM Thursday April 05, 2012 Source: ONE News

A former Bridgecorp investor says he feels sorry for those who lost everything in the finance company's collapse.

Former directors Rod Petricevic and Rob Roest have been found guilty on 18 charges relating to making untrue statements in prospectus documents when raising money from the public. They are being held at Auckland Central Remand Prison.

Peter Steigrad has been found guilty on six of the 10 Securities Act charges he faced.

"You kind of feel sorry for those people which were sold these lies and they invested all their life savings, it's pretty sad," former investor Jonny McLean told ONE News.

He said Bridgecorp painted a rosy picture of its accounts, even in the weeks leading up to its collapse in July 2007.

"When they're kind of sending you these things, saying how well the investments are going and how sound the portfolio is and then next minute, a few weeks later, it's hold on a minute, we're going into receivership."

Petricevic has been denied bail and has been remanded in custody until he is sentenced in April. He was warned in court today that "imprisonment is inevitable".

Roest has also been remanded in custody until he faces sentencing in May.

Steigrad has been bailed as the Crown says he has special circumstances with a dependent spouse and is allowed to travel between New Zealand and his home in Australia.

Roest and Steigrad will be sentenced on May 18 at 10am, and Petricevic will be sentenced on April 26 at 9am.

The Crown is seeking a strong sentence of two to three years for the former directors and prosecutor Brian Dickey said it was reassuring to get the guilty verdicts today.

"To see justice done and send some assurance to the market that cases such as this will be taken seriously by all concerned, particularly the court," he said.

Petricevic and Roest faced 18 charges, six under the Crimes Act, two under the Companies Act and 10 under the Securities Act.

The company collapsed in 2007 but the crown says Bridgecorp began skipping payments to investors almost five months before.

Petricevic's defence lawyer maintained that his client did not have knowledge of missed payments to Bridgecorp investors in March 2007 until the trial began.

Petricevic believed the payments to investors had been made on the next business day after they were due, and therefore "to his mind" there was no problem, Cato said.

The Bridgecorp group of finance companies collapsed in July 2007 owing $490 million to 14,500 investors who are expected to recover less than 10 cents in the dollar.

The group's former chairman, commercial lawyer Bruce Davidson, and another former director Gary Urwin have admitted the charges. Davidson agreed to pay $500,000 in reparations and was sentenced to nine months home detention.