James Stephen Burns (41) has been sentenced in the Wellington District Court today to seven months’ home detention for his part in an advertising invoice scam.
Invoice scam sentencing
James Stephen Burns (41) has been sentenced in the Wellington District Court today to seven months' home detention for his part in an advertising invoice scam.
The scam has been the focus of a major joint enforcement agency operation (Operation Edit) led by the Serious Fraud Office (SFO). Mr Burns pleaded guilty in July this year to 14 Crimes Act charges of using documents with intent to obtain approximately $740,000.
It is alleged that the scam sought to generate approximately $1.6 million in total since 2008. It involved selling advertising in magazines that were either never printed, or in publications where gross misrepresentations as to the number of magazines to be printed and circulated were made to the advertisers. The magazines were generally titled in a way that suggested worthwhile causes in subjects such as road safety or parenting.
SFO Director, Julie Read said, "We hope that the outcomes during this prosecution phase continue to encourage and enhance legitimate economic activity."
Mr Burns will commence his sentence of home detention on 25 October 2014.
Terran Elizabeth Dow entered guilty pleas in July 2013 and was sentenced in October 2013. The three remaining defendants in this matter; Anthony John Hendon, Noelene Kay Banton and Johannes Hendrik Maria Middeldorp have been committed for trial.
For further information
Serious Fraud Office
027 705 4550
Note to editors
Background to investigation
A multi-agency taskforce combining Serious Fraud Office (SFO), the New Zealand Police, the Organised and Financial Crime Agency of New Zealand (OFCANZ), the Commerce Commission, the New Zealand Customs Service, and Inland Revenue was created in May 2012 to combat a long running invoicing scam.
Operation Edit is the first joint investigation of its kind.
Crimes Act offences
Section 228 Dishonestly taking or using document
Every one is liable to imprisonment for a term not exceeding 7 years who, with intent to obtain any property, service, pecuniary advantage, or valuable consideration,-
(a) dishonestly and without claim of right, takes or obtains any document; or
(b) dishonestly and without claim of right, uses or attempts to use any document.
About the SFO
The Serious Fraud Office (SFO) was established in 1990 under the Serious Fraud Office Act in response to the collapse of financial markets in New Zealand at that time.
The SFO's role is the detection, investigation and prosecution of serious or complex financial crime. The SFO's focus is on investigating and prosecuting criminal cases that will have a real effect on:
- business and investor confidence in our financial markets and economy
- public confidence in our justice system and public service
- New Zealand's international business reputation.
The SFO operates 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 2013 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