Managers guilty on $17m fraud charges
Two former managers of retail gas supplier E-Gas Ltd have been found guilty of under-reporting the amount of gas being supplied.
Wellington District Court judge Bruce Davidson found Sydney Lio John Hunt, 46, former general manager, and Ronald Peter Rosenberg, 72, former managing director, each guilty of 41 charges of dishonestly using a document after a month-long trial.
Both men are to be sentenced in May.
The Serious Fraud Office had alleged the E-Gas executives under-reported gas consumption by about 950,000 gigajoules, valued at about $8.7 million and penalties were avoided to the value of about $8.6m between May 2003 and October 2008.
The exact amount is still in dispute and might need to be resolved at a separate hearing.
"Serious financial crime places a high cost on the New Zealand economy and affects all consumers. The SFO will continue to focus resources on these high impact areas and we encourage the business community to be aware of any areas of risk in their own industries,'' SFO director Julie Read said.
The charges carry a maximum sentence of seven years' imprisonment and both defendants have been remanded on bail for sentencing on 29 May.
Judge Davidson remanded both men on bail, but warned them it was no indication that they would not get prison sentences.
In his findings Davidson said there were substantial benefits to E-Gas which must have improved its solvency.
Hunt knew he was submitting inaccurate data about gas consumption and Rosenberg knew that the data was inaccurate and provided dishonestly.
E-Gas was established in 2000 to supply gas to the retail market.
The SFO received a complaint in 2010 about inaccuracies in the amount of gas supplied compared to the amount of gas reported. The company went into voluntary liquidation that same year.