SFO lays charges in North Shore City Council corruption case

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SFO lays charges in North Shore City Council corruption case

The Serious Fraud Office (SFO) announced today that it had laid over 300 charges against Hemant Kumar Maharaj, 57, and Suresh Din, 56, both of Auckland. 

The SFO allege that Mr Maharaj, who worked for the North Shore City Council, and Mr Din, used 151 invoices in a dishonest scheme to obtain over $840,000 from the Council.

SFO Chief Executive, Adam Feeley, said “This a very significant amount alleged to have been defrauded from the Council, and underlines the need for local government to have very robust audit processes to either prevent, or enable early detection of, fraud.”

Mr Feeley said investigating and prosecuting corrupt officials within the public sector who have abused their position of trust over public funds was an area of fraud investigation that the SFO had identified as priority for the Office in its current business plan.

“While New Zealand enjoys an outstanding international reputation for being relatively corruption free, that reputation can only be maintained by good fraud prevention and a swift response to any allegations which could undermine confidence in the integrity of our public sector.”  

Mr Maharaj and Mr Din are jointly charged with 73 counts of using a document with intent to defraud and 78 counts of dishonestly using a document over a period of approximately 10 years. 

Mr Maharaj has also been charged with two counts of attempting to pervert the course of justice in relation to the alleged alteration and provision of a diary and the alleged creation of a receipt book. 

Mr Din has also been charged with one count of using a document with intent to defraud and six counts of dishonestly using a document in relation to the alleged dishonest use of income tax returns that claimed expenditure he had not incurred. 

Both men were remanded on bail, without plea, to reappear on 13 December 2010.

For further information

Nick Paterson
General Manager, Fraud & Corruption
Serious Fraud Office
Phone: 021 675647

Note to editors

The role of the Serious Fraud Office

The Serious Fraud Office (SFO) was established in 1990 under the Serious Fraud Act in response to the collapse of financial markets in New Zealand at that time.

The SFO operates three investigative teams:

  • Fraud Detection & Intelligence;
  • Financial Markets & Corporate Fraud; and
  • Fraud & Corruption.

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…”

The SFO’s Statement of Intent 2010-2012 sets out the SFO’s three year strategic goals and performance standards.  It is available online at: www.sfo.govt.nz

Corruption

Corruption is typically defined as “the abuse of entrusted power for private gain.”

New Zealand is a signatory to the UN Convention Against Corruption (UNCAC) which came into force in December 2005.

UNCAC requires member states to develop effective measures against corruption at both the domestic and international levels, including prevention; criminal sanctions and recovery of criminal assets.

It is complemented by the OECD Anti-Bribery Convention which requires member states to criminalise bribery of public officials.

The SFO has a Letter of Agreement with the NZ Police under which the SFO is the lead referral agency for matters involving bribery and corruption. Under the terms of the Agreement the two agencies jointly review matters referred to SFO to determine the most appropriate agency to investigation allegations of bribery and corruption.

Crimes Act 1961 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.

Section 116 - Conspiring to defeat justice
Every one is liable to imprisonment for a term not exceeding 7 years who conspires to obstruct, prevent, pervert, or defeat the course of justice in New Zealand or the course of justice in an overseas jurisdiction.