Couple jailed over invoicing scam

Husband and wife fraudsters Ross and Wendy Davidson were jailed for a combined total of eight years four months for an invoicing scam that netted millions of dollars.

Ross Davidson, 57, made an offer to the court to pay back reparations of $1.6 million by going into production with a carpet laying device he said he had invented.

But Christchurch District Court Judge Gary MacAskill told him: "Your promises count for nothing."

He sentenced him to four years eight months on 30 charges of using a document with intent to defraud, and his 50-year-old wife Marie to three years eight months on 17 charges.

The court was told the pair operated a company called One Call Flooring in Christchurch employing several staff from about 2006, the Christchurch Court News website reported.

It generated hundreds of invoices which were passed on to a factoring company, Easy Factors International in Auckland, which took over the billing and paid 80 percent of the value back to the flooring company straight away.

But it turned out many of the invoices were false and bills were eventually returned from New Zealand Post saying that the addresses were not known or post office boxes were closed. Many of the post boxes had been opened by the Davidsons themselves.

The factoring agreement generated a rapid and reliable cash flow for the flooring company but it led to huge losses for Easy Factors when the false invoices were uncovered.

Judge MacAskill said it was an elaborate fraud that involved premeditation and preparation. The Davidsons appeared to have used the money "to prop up a high standard of living".

Reparations of $1.6 million were sought from Ross Davidson and $800,000 from Wendy Davidson but Judge MacAskill declined to make an order. He noted that bankruptcy proceedings against the Davidsons were already under way or were available to Easy Factors.

Crown prosecutor Mark Zarifeh said he did not see how any reparation offer could be regarded as realistic given the amount involved, and he also believed that Ross Davidson no longer accepted responsibility because of his comments in the pre-sentence report.

Ross Davidson's defence counsel Elizabeth Bulger said some development work had been done on the carpet laying device but her client had concluded that it would need to be manufactured overseas.

Richard Peters, counsel for Wendy Davidson, said his client was a first offender and had a good support network. She had been found guilty after a district court trial and had been surprised by the jury's 17 guilty verdicts. She continued to deny her responsibility.

Judge MacAskill said her continuing denials meant he could give no weight to claims that she had become involved because of physical and emotional abuse by her husband. The couple have now separated.

The judge said that Ross Davidson's apology to Easy Factors had been vague. His admission of carrying out all the frauds followed by his recent denials meant that his promises "count for nothing".

Ross Davidson's offer to use proceeds from the carpet laying device to pay reparations was far too speculative for the court to consider and he declined to reduce the sentence for it.

It is understood the couple went to live in Australia after the invoicing scheme collapsed.

- NZPA