Two jailed, six leave jobs in country's largest bribery case

By Matt Nippert, Bernard Orsman

Two men were yesterday jailed for their role in the country's largest bribery case and Auckland Transport revealed six other staff left their jobs after investigations began into the scandal.

The episode has triggered warnings from the Serious Fraud Office that the case has not been completely closed - and that corruption required a toxic culture to grow.

Former Auckland Transport senior manager Murray Noone and Projenz managing director Stephen Borlase were sentenced at the High Court at Auckland to five years and five years six months respectively after being found guilty of bribery and corruption.

Noone's request for a two-week delay in starting his sentence until his ankle was cut out of a cast put on after surgery was denied. He left the dock for prison hobbling on crutches.

The pair had been found to have engaged in a seven-year corrupt relationship where Projenz would make regular payments to Noone, overall amounting to more than $1m, while the latter was employed at council-owned organisations overseeing contracts awarded to Borlase's firm.

Barrie George, Noone's deputy throughout the corrupt relationship, had earlier pleaded guilty to accepting bribes from Borlase - mostly in the form of 20 international holidays - and was sentenced last September to 10 months' home detention.

The Herald can reveal Noone, Borlase and George were not the only casualties of the road maintenance case, with six other Auckland Transport staff departing under a cloud after an internal investigation began in 2013.

Auckland Transport said it could not comment on individual cases, but the departures were due to "trust and confidence issues" and included non-compliance with gift and inducement policies.

The court had heard that Projenz, and other contracting firms including Opus and Hiway Stabilizers, had lavished thousands of dollars on long lunches, electronics and local and international travel and accommodation on members of Noone and George's team.

Read said the decision to prosecute only Noone and George from Auckland Transport - found to be the worst offenders by value of bribes received - wasn't made easily.

"There were quite a few different shades of grey in this," she said.

Read said while her office wasn't actively probing Auckland Transport further, she declined to draw a line under the case.

"Not at this stage, but that doesn't mean the matter is completely closed. I know the council are very vigilant, and I guess if something more were to come up we'd expect them to come to us."

The investigation into allegations of bribery and corruption has cost ratepayers $2.5 million for legal and forensic accounting work and thousands of hours of staff time.

Read said she was unable to provide a similar tally for SFO expenditure on the case, but noted it was an eight-week trial and the preceding investigation had begun in 2014.

At sentencing, Justice Sally Fitzgerald told Noone and Borlase their offending had a very real reputational impact on Auckland Transport.

She quoted from a victim impact statement from Auckland Transport executive Greg Edmonds, who said the case had affected staff morale and some staff were embarrassed to say they worked for the transport agency.

Edmonds told the Herald staff in the road maintenance teams at Rodney and Auckland Transport, where Noone worked, felt betrayed.

"We have to rebuild the trust and confidence of the public of Auckland to say we do actually look after their money and spend it wisely and appropriately. That is an ongoing process," said Edmonds.

He said non-disclosure of gifts and payments could occur in any organisation, but Auckland Transport had "very robust" processes in place which helped bring the affair to light.

The processes, which had since been tightened, included requiring suppliers and employees to declare all gifts worth more than $100, six-monthly conflict of interest declarations for all managers and regular fraud and ethics training, he said.

Justice Fitzgerald said pre-sentence reports showed Borlase refused to accept he had done anything wrong, while Noone only showed a "limited" appreciation of his actions.

Read said this attitude showed the need for vigilance, beyond formal policies, to ensure an organisations' culture didn't condone gratuities.

"This sort of behaviour can easily become ingrained in culture to the point where people don't see anything wrong," she said.

Prosecutor Brian Dickey said after the hearing that parties to a bribe were engaged in mutually assured destruction, as neither could report the other without implicating themselves.

"Once you take that first payment you're corrupted for all time: Both parties are trapped."

Mayor Phil Goff said the strong sentences handed down reflected the severity of the crime and the damage caused to public confidence as a result of the offending.

- NZ Herald

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