Gas firm directors charged with fraud

Directors of failed Wellington gas retailer E-Gas are facing $17 million fraud charges, the Serious Fraud Office has announced.

Former managing director, Ronald Peter Rosenberg (71) and former general manager, Sydney Lio Hunt (44) each face 41 charges under the Crimes Act relating to the dishonest use of documents.

The charges carry a maximum sentence upon conviction of seven years' imprisonment.

E-Gas, which had about 7000 customers and sold about 9 per cent of New Zealand's retail gas, was placed in voluntary liquidation in October 2010.

The SFO alleges that between April 2005 and October 2008 Rosenberg and Hunt deliberately under-reported the quantity of gas supplied to its retail customers in order to obtain a pecuniary advantage.

According to a statement, the charges allege that E-Gas under-reported its gas consumption by about 950,000 gigajoules worth approximately $8.74m, and penalties were avoided to the value of approximately $8.67m.

SFO Chief Executive, Adam Feeley said: "Much of the focus of the past few years has been on finance companies.

"However, this case illustrates the diversity of other sectors we investigate, and companies need to be mindful that the risk of fraud exists in whatever industry they operate."

Rosenberg and Hunt will next appear in the Wellington District Court on September 27.