SUPREME COURT Trial Under Companies Act Continues

Press, Volume CIX, Issue 32220, 12 February 1970, Page 7

SUPREME COURT Trial Under Companies Act Continues

The Credit Union of Canterbury Society, Ltd. said a witness in the Supreme Court yesterday, was originally controlled. early in 1965. by a “Mr Warwick"—whose real, name was later found to be Wahrlich—who was an undischarged bankrupt, who had not long before completed a prison sentence in connection with the Sea Fox marine insurance fraud, and who subsequently disappeared. This evidence was given by Donald Aynsworth Carnielo. a storeman, and formerly a director of the Credit Union Society, in the trial of Sydney Raymond Forsyth, a former general manager of the society. ,1 three charges under the Companies Act. Forsyth is charged that between August 11. 1965. and June 24. 1966. he was general manager of the society registered under the Industrial and Provident Societies Act, 1908, in respect of which proper books of account were not kept: that on or about April. May. and June. 1966. he was knowingly a party to the carrying on of its business with intent to defraud its creditors: and that on June 20. 1966. being general manager. he destroyed papers relating to its affairs within 12 months of the commencement of its winding-up. Thirteen Witnesses Heard Forsyth, who is conducting his own defence—in a trial before Mr Justice Macarthur and a jury—pleads not guilty en all three counts. Mr N. W. Williamson, with him Mr W. S. Smith, appears for the Crown. Thirteen of the Crown’s 14 witnesses had been heard up to the adjournment at 5 p m. yesterday The last witness to be called by the Crown will be Mr G. E. Purehas. an accountant, who investigated the Credit Union Society's affairs in June. 1966. which investigation led to the

, society’s eventual winding-up. Mr Carnielo. in his evidence yesterday, said that he re-| plied to an advertisement for | a part-time job with the. Credit Union Society in April,! 1965, was engaged by “Mr Warwick." and subsequently: —after an article about the society in “Truth” of May 26, 1965—became a director of it. Officers Bankrupt Witness said he had learned that “Mr Warwick” was, in fact, a Mr Wahrlich, who was: a bankrupt, and who not long; before had completed a sen-; fence in respect of the Sea Fox marine insurance scandal. A Mr Beeby. another officer of the society, was. 1 witness was told, a double bankrupt, “that is, he had| gone broke twice,” he said? Asked by Mr Williamson | why he had become a direc-| tor. knowing these things. Mr Carnielo said the aims and objects of the society were; never in question. “Theyl were valid." he said. Witness had interested a number of! persons in the society, and had; himself invested £2OO in it.| He thought it best to try to protect those whom he had] interested in the society—hel was not so much worried about; his own investment—and be-; coming a director gave him some small say in it. The Credit Union Society.] he said, was then a part-bank.; part-buying organisation. Per-' sons who joined as members bought a minimum of one 10s share, and after three months; were entitled to buy goods at a discount At that time it; was essentially a saving organisation. Interest was paid to those who paid money into the society, at 6 per cent per annum. Accused's Connection In July, 1965, said witness, he began to work full-time for the society, but for some time without very much recompense. Mr Wahrlich had disappeared, and the society was struggling. Tracing the accused's con-! nection with the Credit Union] Society—from July, 1965 witness said that Mr Beeby, who had been sales manager,! had been dismissed because of “certain irregularities.” The accused was the only man' whom witness knew in Christchurch who could take over the management The ac- ; cused had been a very sue- ' cessful insurance agent, and ! had been regional manager of '

. the insurance company for (which he worked. The accused, witness said, was given virtually an open cheque to “clean up” the society and make it function properly. Witness went on to recount details of accused’s managership. The accused’s long crossexamination was devoted to ] matters of detail, traversing such subjects as “instructions ! regarding stationery—people helping themselves as they liked to ball-point pens.” Further Evidence Evidence was also given by another former director of the Credit Union Society, Leslie Vernon Joseph Bielski, a (production manager. He had been a member of the society, he said, and became a I director in August, 1965. As an employee of the society he was “chief public relations ! officer,” in charge of outside field staff. The accused was in day-to-day control of the society. On information received from the accused, witness thought the Credit Union Society had been "going along very well,” so that it came as a surprise at the meeting on jJune 16, 1966, to be told that the society was running at a (loss. Both Mr Bielski and Mr Carnielo said that they had been dealt with in the Magis-I (trate's Court last year on a !charge of being officers of a! registered society in which: proper books of accounts were ;not kept. I Mr Bielski was also subject: to a cross-examination on matters of detail. Deferred Sentence P'or Burglary On a charge of burglary of a New Regent Street jeweller's shop, for which he ap-| peared for sentence in the Supreme Court yesterday. I Trevor George Brokenshire.; aged 24. a blockiayer (Mr J !E. Butler), was ordered by ] Mr Justice Macarthur »o come (up for sentence within two; years if called upon, on con-; Idition that he pays 8100 to-! wards the cost of his prosecution Brokenshire had pleaded guilty on indictment—reversing a previous plea of not guilty—to the burglary of Terras Bros, Ltd. jewellers. New Regent Street, on November 22 last.