Matt Nippert is a business investigations reporter.

Court hears of council staff's four-figure lunches

Auckland Transport corruption case. Pictured are defendants Stephen Borlase and Murray Noone at Auckland High Court last week. Photo / Doug Sherring
Auckland Transport corruption case. Pictured are defendants Stephen Borlase and Murray Noone at Auckland High Court last week. Photo / Doug Sherring

A roading contractor treated council staff, who awarded his firm contracts, to dozens of four-figure lunches at swanky Auckland eateries, the High Court has heard.

Stephen Borlase, of roading contractor Projenz, and former Rodney District Council and Auckland Transport senior manager Murray Noone are on trial in the High Court at Auckland, facing charges of corrupting a public official through bribery.

The pair have pleaded not guilty to all charges.

In the second week of the five-week trial, the court has been hearing the evidence of Clive Hudson, the principal forensic accountant and electronic recovery investigator for the Serious Fraud Office.

Hudson's analysis of Projenz accounts uncovered $400,000 in gifts - international travel, accommodation, electronics or liquor - provided to Noone or members of his council team.

The analysis revealed $103,413 had been spent by Projenz on 37 of what Hudson called "large-scale meals". Asked by Crown prosecutor Brian Dickey what a "large-scale meal" was, Hudson said he'd drawn the line at any bill over $500.

"But in reality, most of these large-scale meals were well above $1000," he said.

A schedule of large-scale meals was presented to the court, reading like a list of Auckland' swankiest eateries, including such establishments as The Grove, Soul Bar, the O'Connell St Bistro and Kermadec.

The largest single bill was a for a long lunch at waterfront eatery Euro in June 2008.

An emailed invitation to this event was presented to the court by Hudson, who noted he had to recover the message as it had been deleted.

"You are invited to what will be an arduous afternoon of forward planning with the Infrastructure Director," the email said.

Hudson noted the lunch event was scheduled soon after Noone had been promoted to Infrastructure Director of the Rodney District Council.

The final bill for the party of 10 was issued at 10:50pm, 10 hours after the lunch event had started, and totalled $5500. The meal's receipt, presented to the court, included French merlot and champagne, crème brulee and dozens of oysters and was paid by Borlase.

Hudson said the Projenz director recorded the slap-up lunch in company accounts as related to an RDC conference on "road maintenance and capital works".

Another meal six months later, in December 2008, saw 12 council staff rack up a $3606 lunch bill at The French Cafe. The receipt for this meal, featuring 12 bottles of wine - of which five cost in excess of $250 - 28 beers and $170 worth of cigarettes, was also paid for by Borlase.

Hudson brought up several instances of international business-class travel taken by Noone and paid for by Borlase. This included a holiday to Dubai for him and at the luxury Jumeirah Mina A'Salam hotel, where Projenz picked up the $3540 bill for a three-night stay.

Hudson also outlined how Borlase ended up paying $3619 for the March 2013 honeymoon of the daughter of Noone's deputy Barrie George.

Hudson presented correspondence from George showing a four-night booking for an ocean view balcony king room at the beachfront Kimpton Surfcomber Hotel in Miami for his daughter Louise and her new husband Andrew Moore.

George pleaded guilty on the eve of trial to two counts of accepting $103,000 in bribes from Borlase, mostly in the form of 20 overseas trips, and was sentenced to nine months home detention. He is listed to appear in this trial as a witness for the prosecution.

Last week Hudson spent considerable time outlining a regular series of transactions between Noone and Projenz, and between the contractor, RDC and Auckland Transport.

The Crown's case is that the two sets of payments are linked, with Noone receiving $1.1m, mostly paid monthly in the form of "consultancy fees" between 2005 and 2013, from Borlase in an attempt to influence the awarding to Projenz of council road maintenance contracts.

Hudson said during the period in question, Projenz received contracts from RDC and Auckland Transport totalling $32.5m.

Hudson is today expected to face cross-examination from the defendants' lawyers.

The trial, before Justice Sally Fitzgerald alone, continues.

- NZ Herald

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