Pair found guilty of duping finance firms
Two Hamilton businessmen have been found guilty of 32 of 95 fraud charges relating to the duping of several finance companies.
In some instances, Judge Robert Spear found Brett Ralph Dutton, 48, and James Peter Moore, 51, guilty of "double financing" and "phantom financing" in relation to the importation and on-sale of heavy machinery.
In finding the pair guilty, the judge said that he found it "incredible" and "inconceivable" that the pair acted the way they did.
Dutton and Moore originally faced 104 charges, including using a document for pecuniary advantage, theft by a person in a special relationship, forgery and obtaining by deception, allegedly committed between March 2007 and October 2008.
At the beginning of the six-week long trial in the Hamilton District Court in March, Crown prosecutor Tini Clark withdrew nine charges.
The pair were left accused of defrauding six finance companies - UDC Finance, FMG Finance, GE Finance, Lock Finance, Waikato Finance and Blackbird Finance - of more than $3 million by double-dipping on finance for imported heavy machinery.
In his reserved decision released on Friday, the judge found Dutton and Moore guilty on 32 charges relating to four finance companies - UDC, FMG, Blackbird and GE.
Dutton and Moore launched HPL New Zealand Ltd after taking over Henry Peiris Ltd, which was a client of their consultancy business.
They then set up umbrella companies and franchises around the country. They would obtain financing through different companies, import machinery from overseas, including Japan, then either sell or obtain additional financing on those same pieces of machinery.
On several charges, the judge found there was insufficient evidence to convict the pair but remained suspicious of their actions.
Finding them guilty on a charge of using a credit security agreement for pecuniary advantage - refinancing a machine after selling it 11 days before - Moore had testified that was an "honest mistake". But the judge said he found that "difficult to accept even as a possibility that people as experienced in the loan finance industry as Moore and Dutton would make this sort of mistake once, much less over and over again as is proven to have happened".
Addressing Dutton and Moore in court, the judge said that regarding the charges they were found guilty of, he was satisfied that "machines that were financed with one company were then sold quite deliberately and cynically to another company within the accused's stable of companies and offered for finance to another".
The judge said Dutton and Moore both had a long history of working in the banking and loan finance industry "and I really cannot accept that this was an accident or mistaken transaction, or transactions".
The charges include using a document for pecuniary advantage, acting in a way to attempt to defeat a credit security agreement and security agreement, failing to account for the sale proceeds of a machine, dishonest use of a security agreement, and after entering into a credit security agreement on-sold the same machine before pledging the same machine as security.
The pair were convicted on the 32 charges and remanded on bail for sentencing on August 27. They were discharged on the remaining 63 charges.