The alleged fraud, by one of its franchise holders, was discovered by regular MTF auditing procedures last year, with the Serious Fraud Office becoming involved in September, and charges laid shortly after.
At the time of charges being laid, MTF managing-director Angus Bradshaw said the issue was "in recovery mode" and declined to estimate what proportion of the funds might be recovered, but said that it would be less than the $4.9 million of loans under question.
When contacted yesterday, Mr Bradsaw said less than $4.9 million was at stake, and MTF had received about one-third of the lesser figure, from unspecified asset sales and loan repayments, but with court action still under way he declined to reveal more. Provision had been made for the debt in financial terms and a full-disclosure to shareholders would be made, but that could be up to a year away, he said.
MTF's full-year accounts show it carrying $980,000 in bad debt, as opposed to $2.74 million at the corresponding time last year.
MTF's new loan sales for the year were up only slightly, from $267.1 million to $267.9 million, and after-tax profit increased similarly from $5.3 million to $5.7 million.
In order to grow its asset base when economic conditions improve, MTF saw an increase on its capital percentage rise from 14.3% a year ago to 17.1%, and it has a $37 million revolving cash facility with the BNZ, which was undrawn at year-end.
Mr Bradshaw said the second half saw a slowing in new loan activity, reflecting weakened consumer confidence and "general economic malaise" in New Zealand, and globally.
"The company will continue to grow the capital base, through retained earnings, to ensure that the company has adequate capital to provide for asset growth, when the market shakes off the recession," he said in a statement.
In mid-September 110 fraud charges were laid by the Serious Fraud Office against seven people for "obtaining by deception", loans worth a total $4.9 million.
Mark James Whelan (38), formerly of Auckland, operating as an MTF franchise, at the time faced 25 individual charges and 41 joint charges under the Crimes Act and six others also faced Crimes Act charges in the Auckland District Court.
Several of the defendants had since pleaded guilty, with others to have appeared before the courts this week, while two are to be sentenced in December and February.
In September Mr Whelan was accused of obtaining loans totalling $4.9 million, in the names of family and friends, using non-existent assets as security, and then using them for "personal gain".
