Final sentence handed down in Five Star investigation
Final sentence handed down in Five Star Consumer Finance investigation
Neill Allan Williams has today received a sentence of five years' imprisonment following the Serious Fraud Office (SFO) investigation into Five Star Consumer Finance Limited (Five Star).
The 79 year-old appeared in the Auckland High Court this morning for the final sentencing in the long running case. Mr Williams is currently serving three years seven months' imprisonment on charges previously laid by the Financial Markets Authority (FMA). Today's decision will result in an increase in Mr Williams' term of imprisonment of one year and five months.
Acting Chief Executive of SFO, Simon McArley said SFO is now committed to ensuring any activity towards future threats to the economy, equivalent to that of the finance company collapses, is coordinated and effective.
"We move now to addressing threats proactively through intelligence-led detection and inter-agency cooperation - fighting economic crime together to deter future offending and reduce the consequences," he said.
Five Star traded as a finance company accepting deposits from the public and investing those deposits in consumer and commercial lending.
The former key management figure had a role in approximately $43 million of related party lending that occurred between 2003 and 2007. In the course of undertaking this lending, Mr Williams was one of four defendants who intentionally applied funds in breach of the company's obligation under its trust deed.
For further information
Serious Fraud Office
027 705 4550
Note to editors
Background to investigation
The directors of Five Star Finance Limited were Marcus Arthur MacDonald, Nicholas George Kirk and Anthony Walpole Bowden. Neill Williams was not appointed as a director of the company but was heavily involved in the management of the company. Five Star was placed into receivership on 29 August 2007 owing investors approximately $46 million.
Five Star Finance Limited, Five Star Debenture Nominees Limited and Antares Finance Holdings Limited were related companies, and formed the wider Five Star group. The SFO investigation concentrated on transactions entered into between members of the Five Star group and entities related to or controlled by the directors.
In December 2010 Mr Kirk and Mr McDonald received sentences of two years and eight months' imprisonment, and two years and three months' imprisonment respectively. Mr Bowden was sentenced to nine months' home detention and 100 hours' community work.
Crimes Act offences
Section 220: Theft by person in special relationship
(1) This section applies to any person who has received or is in possession of, or has control over, any property on terms or in circumstances that the person knows require the person-
(a) to account to any other person for the property, or for any proceeds arising from the property; or
(b) to deal with the property, or any proceeds arising from the property, in accordance with the requirements of any other person.
(2) Every one to whom subsection (1) applies commits theft who intentionally fails to account to the other person as so required or intentionally deals with the property, or any proceeds of the property, otherwise than in accordance with those requirements.
(3) This section applies whether or not the person was required to deliver over the identical property received or in the person's possession or control.
(4) For the purposes of subsection (1), it is a question of law whether the circumstances required any person to account or to act in accordance with any requirements.
The Serious Fraud Office (SFO) was established in 1990 under the Serious Fraud Office Act in response to the collapse of financial markets in New Zealand at that time.
SFO's role is the detection, investigation and prosecution of serious or complex financial crime. SFO's focus is on investigating and prosecuting criminal cases that will have a real effect on:
- business and investor confidence in our financial markets and economy
- public confidence in our justice system and public service
- New Zealand's international business reputation.
SFO operates three investigative teams:
- Evaluation and Intelligence;
- Financial Markets and Corporate Fraud; and
- Fraud and Corruption.
SFO operates under two sets of investigative powers.
Part I of the SFO Act provides that it may act where the Director "has reason to suspect that an investigation into the affairs of any person may disclose serious or complex fraud."
Part II of the SFO Act provides the SFO with more extensive powers where: "...the Director has reasonable grounds to believe that an offence involving serious or complex fraud may have been committed..."
SFO's Annual Report 2012 sets out its achievements for the past year, while the Statement of Intent 2013-2016 sets out the SFO's three year strategic goals and performance standards. Both are available online at: www.sfo.govt.nz