Former solicitor Edward Errol Johnston is facing charges laid by the Serious Fraud Office (SFO) after he lied to reduce his debt.
Johnston appeared in the Auckland District Court to answer three Crimes Act charges of ‘Dishonestly taking or using document’ and has pleaded guilty to all three charges.
During the months of December 2011 and January 2012, Johnston fell into arrears on his loan repayments to his bank for properties he owned in the Auckland area. He proceeded to submit false Sale and Purchase Agreements to his bank after facing a requirement to reduce his existing debt.
The bank accepted the fictitious transactions. In reality, the properties were either sold for a higher price than he had stated, or transferred to another Trust and refinanced with a loan from another bank. In January 2012 Johnston submitted a false Statement of Assets and Liabilities to the bank when obtaining the refinanced loan.
SFO director, Julie Read
said, “These offences occurred as a result of an attempt to avoid a troubled financial situation. The reality is that in deceiving the bank Mr Johnston has placed himself in a much more serious position which will result in a criminal conviction.
"Such a course should never be considered as a viable option and the SFO will prosecute all serious fraud matters brought to our attention to protect other investors and New Zealand’s reputation as a corruption free market.”
Johnston will appear for sentencing in the Auckland District Court on 10 November 2016.