Auckland pair jailed for big GST fraud

Two Auckland men have been jailed after being convicted of a massive GST swindle involving deals to buy multi-million dollar farms in Waikato and in the South Island.

Alistair John Charles Porter and Murray Joseph Hewitt, both in their early 40s, were found guilty by a jury in Auckland District Court in September of cheating the IRD out of a total of more than $780,000 in GST refunds.

David Jones, QC, counsel for the Serious Fraud Office, told the court that it was a sophisticated, clever fraud to manipulate the tax regime to their own advantage.

Porter, represented by Shane Cassidy, was convicted in relation to fraudulently obtaining a $422,500 GST refund on the bogus purchase of a $3.5 million farm in Taupiri in Waikato in November 2000.

The jury found Hewitt, represented by Jeremy Bioletti, guilty of an almost identical fraud a year later relating to a GST refund of $359,440 on the supposed purchase of a $3 million farm in the Catlins in the South Island.

Porter was also found guilty in relation to that fraud as a party.

Yesterday, Judge Graham Hubble sentenced Porter to four years' jail and Hewitt to three.

The judge said Porter devised the blueprint and encouraged Hewitt to become involved.

Mr Jones described Porter as the architect of the scam and Mr Bioletti said he was the driving force behind the scheme.

The judge said he was incredulous that the pair still maintained their innocence.

He said that the money was transferred overseas immediately and had not been recovered.

Over the four-week trial the jury was told that the men had set up companies which were registered to pay GST on an invoice basis.

Each of the men then entered into contracts for the purchase of farm properties, paying an initial deposit of $1000.

The balance of the deposit was to be paid from the GST refunds and the rest of the purchase price was to be paid by overseas investors.

- NZPA