Jail term in Mutual Finance, Viaduct Capital case

One man has been jailed and two men sentenced to home detention at the Auckland High Court for their part in using finance companies to try to save commercial businesses during the global financial crisis.

Wednesday, March 27th 2019, 2:53PM

Paul Bublitz was found guilty of four charges of theft by a person in a special relationship and two charges of false statement by a promoter. He was sentenced to three years two months imprisonment for each of the charges, to be served concurrently.

Bruce McKay was found guilty of three charges of theft by a person in a special relationship. He was sentenced to 12 months home detention for each charge, to be served concurrently.

Richard Blackwood was found guilty of four charges of theft by a person in a special relationship. He was sentenced to 9 months home detention for each charge, to be served concurrently.

McKay and Blackwood were directors of Viaduct Capital and Bublitz was on the board of Mutual Finance when they went into receivership.

Nick Kynoch, Financial Markets Authority general counsel, said: “This case involved theft and deliberate misconduct in dealing with funds invested by the public. It also involved abuse of the Crown Retail Deposit Guarantee Scheme, which resulted in the taxpayer meeting substantial costs and losses.

“This was a difficult and complex case, which took considerable time and resource to investigate and prosecute. However, such was the cynical and egregious nature of the misconduct, the defendants had to be held to account for their actions. The FMA would like to acknowledge the support of the Crown Solicitor in being able to do so.

“This case shows how complex and difficult it can be to investigate and prosecute so-called ‘white collar crime’. This was criminal activity that affected not just the investors, but also taxpayers.

“It involved misleading investors, with false statements in the prospectus, as part of a deliberate plan designed to funnel investors funds, and ultimately tax payer funds, to support Mr Bublitz’s failing commercial enterprises. We are pleased that today sees the defendants being held to account for their actions.”

Tags: finance companies