A FALSE PRETENCE

Evening Post, Volume CII, Issue 37, 12 August 1921, Page 11

A FALSE PRETENCE

COMPANY DIRECTOR FOUND GUILTY.

(BT TELEGRAPH. —PRESS ASSOCIATION.)

AUCKLAND, Uth August. In the .Supreme Court to-day, the third day of the trial, Alfred Oscar Otto, managing director of the National Co-oper-ative Reality Company, was found guilty of obtaining' £400 from James Mackay Linklatei' by means of a false pretence. The Crown case was that accused misrepresented the financial' position of the company to I&iklatei", and thereby inducedi him to take shares in the company. Accused represented the turnover to be over £10,000, the assets between £3000 and £5000, and the liabilities £100. When Linklater's solicitor asked for the books, he was told that they were not written up, as the firm was too busy making money, and) a balance-sheet had not been made out. The solicitor advised against investment, but Linklater invested, and was engaged also as a salesman. Shortly afterwards Linklater discovered in the office a statement signed' by accused, showing the liabilities to be £2186 and the assess £200 less. Immediately he joined th« office Linklater was asked for a loan of, £200, on- the ground of financial stringency, and to keep the company afloat. •In ,Ma-rch, a distress warrant for £141 was issued against the company, Linklater paying the amount, and taking a bill of sale on the company's furniture. In addition, he advanced £113 to pay rent, typist's wages, and legal expenses". . The 1 defence was that the accused honestly believed what he represented, and that the statement in question, not show assets, only liabilities. A public accountant gave evidence that a comparative statement of -affairs for the same period showed, that the company was at that time in a .fairly substantial position, the assets exceedin^a' liabilities by £5452, leaving out the fully paid-up capital, £5755, which was a liability, but balanced 'by goodwill of a similar amount. He admitted that it was purely a paper balance-sheet, but said it was drawn up from the company's books. The jury recommended, prisoner to mercy on account of his having ai wife and seven children. Sentence was deferred.