Disgraced CFO Peter Gregg’s epic downfall

He was one of the nation’s top executives but a shattered Peter Gregg has now been convicted of falsifying company records.

Former Leighton Holdings executive Peter Gregg arrives at Sydney District Court Tuesday to face sentencing for charges of falsifying documents. Picture: AAP

He was the numbers man for two of Australia’s most prominent companies and a chief executive at a third, earnings millions in annual salary and bonuses before his world came crashing down.

Peter Gregg, 64, will avoid jail but now faces the prospect of a year of home detention after being convicted on two counts of falsifying company records.

In sentencing him on Tuesday, Judge Paul Lakatos said Gregg was “a broken man”.

Unable to find work and having difficulty even securing a credit card, the former Leighton Holdings chief financial officer cannot look forward to a comfortable retirement, the Sydney District Court heard.

He suffers anxiety, sleeplessness and “extremely severe depression” described as an adjustment disorder following his charging and conviction over the offences committed in August 2011.

The father of two girls and grandfather to five children has sold the family home and lost much of his fortune after two divorces, the second to a woman he married five years earlier and who left when he was charged.

Another $2.42 million has been spent defending the charges and taking defamation action against a newspaper.

After a five-week jury trial Gregg was found guilty of two offences under section 1307 (1) of the Corporations Act.

The charges followed an Australian Securities and Investments Commission investigation that has already led to a five-year ban on Gregg acting as a company director.

A complex prosecution case centred on two payments totalling $US15m ($21m) made by Leighton — acting on Gregg’s authority — to a company operating out of the United Arab Emirates called Asian Global Projects and Trading. The court accepted ASIC’s argument that a 2011 deal to buy and sell steel with Asian Global was “never a genuine agreement”.

The first payment of $US12.5m million was recorded as being for “marketing and advisory” services, while a second payment worth $US2.5m was described as a loan. ASIC alleged the books were also falsified when the payments were backdated to earlier in 2011 in a further attempt to “justify” the payments.

Justice Lakatos said the evidence was “overwhelming” that payment was so that Asian Global would provide a waiver from a loan repayment that could have triggered a writedown in the value of Leighton India, of which Gregg was a director.

Leighton had previously sold a 35 per cent stake in the business to the owners of Asian Global, and written up its value by $200m.

But complex conditions agreed by both sides could have seen that deal unravel at a time when Leighton was already under pressure from investors, according to reports of the court hearing

The Crown pushed for Gregg to face a custodial sentence, with each offence carrying a maximum two years’ jail and an $11,000 fine.

Justice Lakatos said while the first offence was “objectively” serious, the sum involved placed it at the lower range for sentencing.

The second offence was at the mid-range, but neither deserved a full-time custodial sentence.

The sum involved was not material to a company the size of Leighton and the offences had not been committed for personal gain, the court heard.

And because the two offences were linked the penalty could be served concurrently.

Pending a three-week assessment, Gregg will serve one year of an Intensive Correctional Order for the first offence and two years for the second. One year of home detention would ensure that the sentence was seen as an ICO with “bite”, Justice Lakatos said.

Gregg was a “accomplished” man of good character — he provided references from his former Qantas Airways boss Geoff Dixon and from Grant Fenn, the chief executive of Leighton rival Downer EDI, among others.

He had strong prospects of rehabilitation and his chances of reoffending were low because he was banned from acting as the director of a company and the conviction meant he was unlikely to find a job of the kind he used to hold.

Gregg was “in many respects a broken man” who had been “deprived of is sense of self worth” in the latter years of his life. The once gregarious executive had lost confidence and avoided socialising.

He had told the court he had not held on to the majority of his worth through two divorces and had net wealth of $4.95m. Gregg remains on bail pending his assessment for home detention.