Capital+Merchant Finance Limited traded as a finance company offering property and investment loans, and accepting deposits from the public.  It was placed into receivership on 23 November 2007 owing approximately 7,500 investors around $167 million.   The receivers representing the public investors do not expect any recovery as the assets of the company will be applied to meet the claims of the prior security holder. 

After considering a complaint received from the receivers of the company, the Director determined that an investigation into the affairs of Capital+Merchant may disclose serious or complex fraud.  An investigation under Part II of the Serious Fraud Office Act was commenced on 18 February 2010.

The Judge alone trial of Wayne Douglas and Neal Nicholls commenced on 23 April and was completed on 04 May.

After hearing evidence, the Judge reserved his decision. He is expected to make his decision after a second trial involving Mr Douglas and Mr Nicholls is completed. This matter relates to additional fraud charges. They are due to appear for trial at the Auckland High Court on 14 May. The trial is expected to last five weeks.

A trial in the Auckland High Court will commence on 23 April 2012. Neal Nicholls and Wayne Douglas have been jointly charged with 1 x s220 Crimes Act 1961 and 2 x s242 Crimes Act 1961.

The prosecution of Douglas and Nicholls has been committed for trial.  An application to discharge under section 347 of the Crimes Act has been made.  This application will be heard on 21 July 2011.

On 9/12/10 six charges under sections 220 and 242 of the Crimes Act were laid against each Neal Medhurst Nicholls and Wayne Leslie Douglas. 

Both were directors of Capital + Merchant Finance Limited when the company advanced loans of approximately $14.5M between April 2002 and September 2004 to three companies that converted two Palmerston North high rise office blocks into student accommodation.  The development was known as the Hub.

Both men were remanded on bail. 

The SFO is continuing to investigate a number of other transactions and a new investigation file has been commenced to enable these investigations to continue.

The Office is investigating a number of transactions entered into by Capital+Merchant Finance and related parties in the period between 2002 and 2007.  An interim investigation report is expected to be completed for consideration by the Director by the end of November 2010.  A decision will be made following that regarding continuation of the investigation and/or prosecution.

If you have information you would like to discuss with the SFO, please make contact with us via the contact details below.

The case manager for this case is Willie Harris.  If you have questions regarding your personal involvement with this case or information that may assist the investigation, he can be contacted on willie.harris@sfo.govt.nz or 0800 109 800. 

For media enquiries call 027 705 4550