Accountant admits $2.3m fraud

An accountant has admitted stealing $2.3 million, some of it from the estate of his father-in-law.

John Charles Liddy used the money to prop up a company where he was employed, paying of salaries to staff -- including himself.

The 49-year-old, from Christchurch, now faces a lengthy prison sentence.

The Serious Fraud Office said that over a period of eight years, Liddy stole from five different sources, including the estate of his father-in-law.

Each was associated with Liddy through marriage and though he had signing authority, that did not mean he could use the money for his own benefit or for his company.

He was not a beneficiary of the trusts or the estate, and he was not a shareholder in the two companies he took money from. The total value of the offending was $2,290,092.

Liddy had used cheque books to write out cheques for his personal benefit. He mostly filled out the cheque butts accurately, but in some of the 157 individual transactions he mis-recorded information to conceal the nature of the transaction.

He used some of the money to buy a rental car franchise, and later stole about $1 million to prop up his rental company, CRS Ltd.

This included buying new vehicles for the company. Some money was shifted between the entities to cover up previous offending.

His accounting records were poorly maintained and his offending was discovered when tax returns and financial accounts fell behind and the family sought documentation for tax purposes.

The SFO stated: "He denied living the high life but admitted that some of the funds were used for lifestyle. The majority of the stolen funds were transferred into CRS Ltd."

Liddy is now in custody awaiting what Judge Murray Abbott called a substantial and inevitable term of imprisonment.

Judge Abbott asked for a pre-sentence report, a reparation report, and for victim impact statements to be available for the sentencing judge.

Liddy pleaded guilty in Christchurch District Court to 13 charges brought by the SFO for dishonestly taking or using documents, and using documents with intent to defraud.

Prosecutor Brent Stanaway said the SFO opposed bail. He said: "Having regard to the size of the frauds, several years' imprisonment is the likely penalty. Mr Liddy has had ample opportunity to put his affairs in order."

Liddy has already paid back $724,319 and defence counsel Pip Hall told Judge Abbott that if he was allowed bail pending sentence it would allow him to pay back another $100,000.

But Judge Abbott remanded him in custody for a Crown sentencing session as there was no compelling information why he should be bailed.

"This was extremely serious offending," said the judge.

- NZPA