Guilty pleas in relation to public health care provider and charitable trust fraud

The second and final defendant in a Serious Fraud Office (SFO) case has pleaded guilty to fraud in the Auckland High Court today.

Saul Roberts and Atish Narayan were charged in January 2017 under the Crimes Act and the Secret Commissions Act.

Saul Roberts, the former Asset Manager for Te Roopu Taurima O Manukau Trust (Te Roopu) and Trustee and employee of Te Kawerau Iwi Tribal Authority (Te Kawerau), faced five charges under section four of the Secret Commissions Act and today pleaded guilty to all charges.

While acting as a Trustee at Te Kawerau in 2009, Mr Roberts received a secret payment of $45,000 in return for withdrawing public submissions he had lodged on behalf of Te Kawerau in opposition to a proposed change to a District Plan. The company that made the payment was unaware that Mr Roberts was acting without the knowledge and consent of his employer.

In 2012, while employed by Te Roopu, Mr Roberts received secret commission payments in return for contracting work to certain suppliers to Te Roopu, including businesses owned by his co-defendant, Atish Narayan. Mr Roberts received a certain percentage of each invoice as a cash kickback.

Atish Narayan, a supplier of goods and services to Te Roopu, pleaded guilty to two charges under section three of the Secret Commissions Act as well as one Crimes Act charge of ‘Obtaining by deception’ in August 2017. Mr Narayan owned two auto repair businesses which provided services to Te Roopu. Mr Narayan made undisclosed payments to Mr Roberts, in return for Mr Roberts arranging for vehicles owned by Te Roopu to be serviced or repaired at his businesses.

Te Roopu, a public health care provider for people with intellectual disabilities, and Te Kawerau, set up to settle treaty claims, were the victims of the fraud.

Mr Narayan was sentenced to 6 months’ home detention and ordered to pay $14,000 in reparation in October 2017.

Mr Roberts will be sentenced on 27 February 2018.

SFO Director, Julie Read said, “Deliberate acts of fraud against a publicly funded health care provider and a charitable trust are completely unacceptable and a matter of significant public concern. The SFO’s role is to prosecute such matters on behalf of New Zealanders in order to keep these organisations free from corruption.”

ENDS

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Note to editors

Background to investigation

Te Roopu Taurima O Manukau Trust (Te Roopu) is a publicly funded health provider based in Otahuhu, South Auckland. Te Roopu provides long-term residential health care for people with an intellectual disability who are unable to be supported in their home. Te Roopu owns a number of properties around the country and funding is provided by the Ministry of Health.

Te Kawerau Iwi Tribal Authority (Te Kawerau) is a Charitable Trust established to benefit the people of Te Kawerau a Maki and settle that tribe’s treaty claims.

Crimes Act offences

Section 240 Obtaining by deception or causing loss by deception
(1) Every one is guilty of obtaining by deception or causing loss by deception who, by any deception and without claim of right,—
(a) obtains ownership or possession of, or control over, any property, or any privilege, service, pecuniary advantage, benefit, or valuable consideration, directly or indirectly; or
(b) in incurring any debt or liability, obtains credit; or
(c) induces or causes any other person to deliver over, execute, make, accept, endorse, destroy, or alter any document or thing capable of being used to derive a pecuniary advantage; or
(d) causes loss to any other person.
(1A) Every person is liable to imprisonment for a term not exceeding 3 years who, without reasonable excuse, sells, transfers, or otherwise makes available any document or thing capable of being used to derive a pecuniary advantage knowing that, by deception and without claim of right, the document or thing was, or was caused to be, delivered, executed, made, accepted, endorsed, or altered.
(2) In this section, deception means—
(a) a false representation, whether oral, documentary, or by conduct, where the person making the representation intends to deceive any other person and—
(i) knows that it is false in a material particular; or
(ii) is reckless as to whether it is false in a material particular; or
(b) an omission to disclose a material particular, with intent to deceive any person, in circumstances where there is a duty to disclose it; or
(c) a fraudulent device, trick, or stratagem used with intent to deceive any person.

Secret Commissions Act offences

Section 3 Gifts to agent without consent of principal an offence
(1) Every person is guilty of an offence who corruptly gives, or agrees or offers to give, to any agent any gift or other consideration as an inducement or reward for doing or forbearing to do, or for having done or forborne to do, any act in relation to the principal’s affairs or business (whether such act is within the scope of the agent’s authority or the course of his employment as agent or not), or for showing or having shown favour or disfavour to any person in relation to the principal’s affairs or business.
(2) Any gift or other consideration given or offered or agreed to be given to any parent, husband, wife, civil union partner, de facto partner, or child of any agent, or to his partner, clerk, or servant, or (at the agent’s request or suggestion) to any other person, shall be deemed for the purposes of this section to have been given or offered or agreed to be given to the agent.

Section 4 Acceptance of such gifts by agent an offence
(1) Every agent is guilty of an offence who corruptly accepts or obtains, or agrees or offers to accept or attempts to obtain, or solicits from any person, for himself or for any other person, any gift or other consideration as an inducement or reward for doing or forbearing to do, or for having done or forborne to do, any act in relation to the principal's affairs or business (whether such act is within the scope of the agent's authority or the course of his employment as agent or not), or for showing or having shown favour or disfavour to any person in relation to the principal's affairs or business.
(2) Every agent who diverts, obstructs, or interferes with the proper course of the affairs or business of his principal, or fails to use due diligence in the prosecution of such affairs or business, with intent to obtain for himself or for any other person any gift or other consideration from any person interested in such affairs or business, shall be deemed to have corruptly solicited a consideration within the meaning of this section.

About the SFO

The Serious Fraud Office (SFO) was established in 1990 under the Serious Fraud Office Act. 

The SFO is the lead law enforcement agency for investigating and prosecuting serious or complex financial crime, including bribery and corruption. 

The presence of an agency dedicated to white collar crime is integral to New Zealand’s reputation for transparency, integrity, fair-mindedness and low levels of corruption.

This work contributes to a productive and prosperous New Zealand and the SFO’s collaborative efforts with international partners also reduce the serious harm that corrupt business practices do to the global economy. 

The SFO has three operational teams; the Evaluation and Intelligence team along with two investigative teams. 

The SFO operates under two sets of investigative powers. 

Part 1 of the SFO Act provides that it may act where the Director “has reason to suspect that an investigation into the affairs of any person may disclose serious or complex fraud.” 

Part 2 of the SFO Act provides the SFO with more extensive powers where: “…the Director has reasonable grounds to believe that an offence involving serious or complex fraud may have been committed…” 

In considering whether a matter involves serious or complex fraud, the Director may, among other things, have regard to:

• the suspected nature and consequences of the fraud and/or;
• the suspected scale of the fraud and/or;
• the legal, factual and evidential complexity of the matter and/or;
• any relevant public interest considerations. 

The SFO’s Annual Report 2016 sets out its achievements for the past year, while the Statement of Intent 2014-2018 sets out the SFO’s strategic goals and performance standards. Both are available online at www.sfo.govt.nz(external link)  

The SFO Twitter feed is @FraudSeriousNZ(external link)