Quake-related stress has been ruled out as a factor in a chief executive's dishonesty that led to him deceiving investors and insurance company Vero and causing losses of $1.1 million.
Christchurch District Court Judge Alistair Garland did not accept a defence suggestion that the offending by Stuart Crellin Bell, 37, arose from acute stress.
He jailed Bell for two years and three months on seven charges.
The judge said Bell's "white collar" offending had started well before the Christchurch earthquakes.
"Certainly the earthquakes may have exacerbated the financial circumstances and then he went on to defraud the insurance company," he said.
A psychiatric report on the former chief executive of the Christchurch company, Black Box Spatial Ltd, has shown a diagnosis of dissociative amnesia.
The defence had asked the psychiatrist whether there was any psychiatric reason that made Bell more vulnerable to reacting dishonestly when under stress.
The psychiatrist replied: "I don't feel there is anything in Mr Bell's psychiatric state that would cause him or make him more likely to react in a dishonest way to alleviate stress."
Defence counsel Richard Maze said Bell had been able to contribute $80,000 towards reparations.
He said the psychiatric report called into question whether Bell appreciated what he had previously done as the offending unfolded. This meant premeditation could be given less weight as an aggravating factor.
The offending had arisen from "acute stress".
Maze argued for a sentence of home detention which would allow Bell to continue retraining, receive treatment, and to care for his wife and children. He urged the judge to grant a significant sentence reduction for Bell's personal circumstances.
Crown prosecutor Anselm Williams said the issue of a reduction of sentence for Bell's guilty pleas was affected by the psychiatrist's diagnosis of dissociative amnesia which may have meant that earlier pleas may not have been possible.
But he said a reduction of no more than 20 per cent should be granted.
Bell last year admitted a charge of obtaining finance by deception, two of using forged documents, three of dishonestly using documents to obtain a financial advantage, and one of using an altered document to obtain money by deception. He was remanded on bail for sentencing today.
He had deceived investors with altered emails which made the company's prospects appear more profitable.
He also made claims for business interruption insurance from the earthquakes, using contracts that were false.
His dishonestly led to the company investors losing $390,000 and Vero losing $713,000 - a total of $1.1 million.
Judge Garland said premeditation was an aggravating factor because of his repeated use of documents that were doctored or forged, over a sustained period. Other factors were the amount involved, and the insurance fraud at a time when insurance companies were struggling with the sheer volume of claims.
His fraudulent claims involved a substantial breach of trust. His impact on his investors had been substantial financially and in terms of the emotional harm he had caused.
They had indicated some forgiveness at a restorative justice meeting that had been held, but they were now finding circumstances difficult after their losses.
He noted that although Bell was making a payment towards reparations, he was in no position to pay the substantial balance of the money he had defrauded from the investors and the insurance company.
He said Bell's only personal gain from the offending had been continuation of his salary from the company.
"This was a desperate but dishonest attempt to keep the business operating in the vain hope that things would come right and that would secure your and your family's future," Judge Garland said.
He did not reduce the sentence for the reparation paid, because of the shortfall. No other reparation is sought by the victims.
He reduced the sentence for Bell's guilty pleas, the psychiatric diagnosis, his remorse and apology, his previous good character, and his personal circumstances.
Judge Garland accepted Bell and his family had lost their assets, and he may now face bankruptcy.
Bell has now obtained work as an apprentice builder, and Maze said no personal deterrence was needed because Bell would never run a company again.
- The Press