A former MP played a part in a fraudulent money-go-round involving children's books, a Serious Fraud Office prosecutor has told a judge.
The former MP, whose name is suppressed, is on trial in Auckland District Court with three others accused of involvement in a swindle involving hundreds of thousands of dollars between 2003 and 2005.
Delivering his closing submissions, prosecutor Mike Ruffin said the MP and another accused, Robert Briggs, arranged for a charitable trust, the name of which is suppressed, to enter into arrangements for the supply of children's books by a company owned by the former MP.
The trust was told it would be charged the net cost of the books plus 20 percent, and that it could apply for a grant from a trust managed by Briggs which operated gaming machines and distributed money raised by the machines.
If the grant was not made to the trust it would not go ahead with buying the books, Mr Ruffin said.
The application for funding was made by the trust to Briggs' trust, and funds were obtained.
Payments totalling $491,121.98 were subsequently made by the charitable trust to the companies controlled by the former MP.
The licence held by Briggs' trust did not allow it to make grants of gaming profits to any party which would result in commercial advantage to any gaming machine sites or to any other party.
Mr Ruffin said the payments retained by the two companies resulted in a commercial advantage, either directly or indirectly, to the former MP.
Payments were also made to Briggs or creditors of Briggs totalling $68,546.89, Mr Ruffin said.
"These payments were not legitimate payments and both accused knew that," he said.
"The payments were not made as loans, Rather, the money flow reflected a dishonest scheme, agreed upon by both accused to obtain for themselves the benefit of gaming machine net proceeds, money they both knew they were not entitled to."
The former MP is also accused of faking a receipt book, for which he faces a charge of attempting to obstruct the course of justice.
Mr Ruffin also went over other charges relating to Briggs and to a man and a woman who also have name suppression.
Briggs is accused of arranging for the tennis clubs and children's charity to take grants of money raised by the pokie machines. They are then said to have paid money back to him through a series of companies involving his fellow accused.
Defence lawyers are due to present their arguments on Wednesday in the trial, which is being heard by Judge Roderick Joyce without a jury.
