FALSE PRETENCES

Hokitika Guardian, 13 August 1921, Page 1

FALSE PRETENCES

COMPANY MANAGER CONVICTED. AN EASY VICTIM. AUCKLAND, Aug. HAt the Supremo Court to-day, it was the third day of the trial of Alfred Oscar Otto, managing director ot the National Co-operative Reality Coy. He was found guilty of obtaining from .1 spies Mnckay l.inklnter l.y means of false pretence. The Crown case was that tlm accused misrepresented the financial position of the company to l.inklnter, and thereby induced him to take shares in the company. The accused represented the turnover as £10.000; the assets as between £IOOO and CSOOO, and the liabilities at, about £IOO. When Linklater’s solicitor asked for the hooks he was told that they weren’t written up. as the firm was too busy making money. The balance sheethad not been made out. Hi s solicitor advised against the investment, but T.inklater invested, and was engaged ns a salesman. Shortly afterwards T.inklater discovered in the office a statement, signed by the accused, showing the liabilities as £2186, and the assets £2OO less. Immediately lie joined office. T.inklater was asked for a loan of C2OO. on the ground of financial stringency, and to keep the company afloat. Tn March a distress warrant for £l4l was issued againstthe company. l.inklnter paying the amount and taking a bill of sale on the company’s furniture. Tn addition he advanced £ll3 lo pay rent, the typist. a-n-d legal expenses. The defence was that, the -accused honestly believed what ho represented, viz., that the statement in question did not show the assets, hut only liabilities. A public accountant gave evidence that a comparative statement of affairs for the samo period showed the company was at that time in n i airly substantial position, the assets exceeding the liabilities by £5452, leaving out. the fully paid up capital of £5,755, which was a liability, but was balanced by the goodwill of a similar amount. Ho admitted it was purely a paper bal-ance-sheet. bill it was' drawn from the company’s hooks. The jury recommended him to mercy on account of bis wife and seven children. Sentence was deferred.