Fraudster’s sentence called 'disgusting'

Kevin Phillips.
Kevin Phillips.
A Dunedin businesswoman who funded her gambling habit through fraud of more than $200,000 has  had her name suppressed and been sentenced to community detention, in a decision labelled as "disgusting" by her victims.

The woman spent her first night of community detention in her Dunedin home  yesterday after appearing for sentence in the Dunedin District Court on 26 counts of aiding and abetting her former company’s failures to account for PAYE and five counts of aiding and abetting the company’s GST evasion.

She was the sole director and shareholder of the company which failed to pay $108,204.91 in employees’ PAYE, KiwiSaver deductions and KiwiSaver employer contributions, and GST of $125,661.40 between July 2013 and September last year.

Judge Kevin Phillips suppressed the woman’s name, address and occupation as well of that of her current employer to protect the employer’s company from extreme hardship.

The woman was sentenced to five months’ community detention and 200 hours of community work and was ordered to repay the $233,866.31 she defrauded from Inland Revenue.

The sentence drew gasps  from her former employees who were seated in the public gallery of the court, one labelling it a "slap on the wrist".

Outside court, the group were visibly shaken and "in shock", and labelled the sentence and ongoing name suppression of the woman as "disgusting".

Judge Phillips said her current employer, in an unrelated industry, were undeserving of the extreme hardship which would befall them by association with the woman.

"Your employing company ... made a conscious decision to stay with you," he said.

"Their good thoughts and good endeavours shouldn’t result in their name being published and them being punished," the judge said.

He rejected  arguments from the woman’s own counsel, Sally McMillan, that she should retain name suppression and said the woman’s name would only be kept from the public because of her association with her current employer.

The company was represented in court by Colin Withnall QC.

Judge Phillips did not sentence her to prison or home detention as it would prevent her from working and repaying her debt to the taxpayer.Speaking outside court, the woman’s victims said she had gutted the company because of her  greed.

"It was an absolute disgrace," one woman, who did not want to be identified, said of the sentence.

"We have been rocking up to work every day and for what? To fund her gambling."

The number of employees at the company had  dropped from about 30 to eight by the time the woman’s offending came to light.

The company was put  into liquidation earlier this year.

The victim said two former employees of the company only realised their KiwiSaver contributions were not being paid when they retired and went to draw on the funds.

Two other single mothers were struggling to get Working for Families tax credit entitlements as their income was recorded by Inland Revenue as zero because of the woman’s fraud.

"Do the crime, do the time," that victim said in reaction to the sentence.

"This has been three years of offending."

In sentencing the woman, Judge Phillips said he was not convinced the woman was sorry for her offending.

"It’s doubtful whether there is any real remorse," he said.

The woman had spent the defrauded money on almost $280,000 of online gambling with her losses totalling about $160,000.

She had tried to minimise her offending, he said.

"The only inference I can draw from all the facts before me is that you knowingly and willingly gambled away all the money," he said.

"What really sticks out about this all is that the most unconcerned person about the process is you."

The woman, the only person responsible for all aspects of the company’s trading activities and finance, knew she was not complying with the company’s tax obligations, a summary of facts said.

The company was solvent at all stages and would have been able to pay its PAYE and GST had the defendant complied with its obligations.

The woman’s failure to do so was a result of her intent for the company to evade payment rather than a matter of inability to pay.

But the company no longer had the money to pay because the defendant had spent it on online gambling.

The woman was ordered to pay a lump sum of $60,000 yesterday and further lump sums of $30,000 every eight months until the reparations were repaid.

timothy.brown@odt.co.nz

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