SFO will not pursue Brownie

The Nelson District Court has awarded judgment against former Nelson car dealer Paul Brownie but the Serious Fraud Office has decided it cannot pursue a case against him or LDC Finance.

Mr Brownie is the director of Halifax Finance which was intricately linked to the collapse of two other Nelson companies, LDC Finance and F&I Finance in 2007. He is now based in Kaiapoi and has not returned calls from The Nelson Mail.

Serious Fraud Office chief executive Adam Feeley said police referred a complaint about Halifax Finance and LDC to his office.

It alleged that Mr Brownie owed F&I about $230,000, and that the owners of LDC Finance induced F&I's principals to invest through false or misleading representations.

"Whilst some of the information provided suggests the possibility of financial mis-statements and omissions, there was insufficient evidence to suggest criminal fraud in excess of $2 million," Mr Feeley said.

"It would therefore be inappropriate for this office to commit its resources to investigating the matter further."

Mr Feeley said the decision reflected the new approach taken by the SFO since restructuring.

"As an agency with limited resources, the office must focus on cases of serious criminal offending where the outcome will have a direct effect upon investors' confidence in financial markets.

"Inevitably this will result in cases not being selected for investigation."

F&I was currently involved in civil proceedings with LDC and its principals in relation to these matters, while allegations regarding financial mis-statements or omissions were most appropriately assessed by the Securities Commission and the Companies Office, Mr Feeley said. "The office has made the appropriate referrals in this regard."

Although not totally unexpected, the SFO's decision is a disappointment to F&I principals Andrew Harding and Murray Scholfield who have been fighting to get justice for their creditors.

Last week Nelson District Court ordered Mr Brownie to pay Mr Harding and Mr Scholfield $245,734 plus $28,287 interest and $9668 costs. Mr Brownie did not attend the hearing.

"I'm pleased the judgment has been awarded," Mr Harding said yesterday.

Earlier last month the High Court in Nelson approved an application by Alison Lawley and Gary Calderbank to place Halifax Finance in liquidation. The pair had invested in Halifax Finance and said they wanted to uncover on behalf of all investors what Mr Brownie had done with the funds.

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