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Feltex director vents anger at court case

Fuseworks Media
Fuseworks Media

Auckland, Aug 2 NZPA - An angry Feltex director, one of five found not guilty of breaching financial reporting standards, has accused the Registrar of Companies of bringing a groundless case against them, wrecking their reputations.

Five directors -- Peter Hunter, Peter Thomas, Michael Feeney, John Hagen and former chairman Tim Saunders -- were charged with failing to publish a breach of Feltex's banking covenants and not properly classifying its $A119.5 million ($NZ157m) ANZ Bank debt facility. They all denied the charges and were found not guilty in Auckland District Court this morning.

Judge Jan Doogue said there was overwhelming evidence they were honest men of unimpeachable integrity and there was no evidence that they misled market shareholders or investors.

Speaking outside the court, Mr Hagen said he was relieved but angry that the case was ever brought.

"There was never any grounds for this case to be brought. There was never evidence that we hadn't done what we were supposed to have done as directors and in the weeks ahead I will take this up with Neville Harris, the Registrar of Companies, so that he realises the damage he has done to people's lives.

"This case has done a lot of damage to people's reputations with no chance for redress and that makes me and the other directors very cross and as shown by the judgment today this case was totally unnecessary."

Paul Davison QC, for Mr Feeney and Mr Thomas, during the court case said the prosecution had been reduced to "clutching at straws".

The men had done everything that reasonable and conscientious directors could have possibly been expected to do in compiling their accounts, most notably employing accounting firm Ernst & Young to review the company's report, he said.

The Crown argued the directors should have done more to ensure the statements were compliant and they should have read the standards themselves.

Feltex was floated on the New Zealand stock exchange in May 2004 and raised $254 million.

The company collapsed two years later.

The ANZ, which was owed $135 million, placed Feltex into receivership, and days later its assets were sold to rival firm Godfrey Hirst.

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