Versalko's family 'all victims' of his crimes

Stephen Versalko. Photo / Dean Purcell

A relative of New Zealand's $17.8 million fraudster says being a member of the Versalko family is like living with a "bomb that has exploded".

Andrea Versalko said yesterday the family had been through the mill since learning of Stephen Versalko's fraud, at the same time as the media.

The Auckland woman, who is married to Versalko's brother Andy, believed all the trouble could have been avoided if the ASB Bank investment adviser had just asked his family for help.

"He should have just said, 'I've got money problems', and we all - I'm sure all of us - would have helped him. There was no need to go and do something like that," she said.

Versalko, 52, was last week jailed for six years for running a scam in which customers' money was supposedly placed in high-yield investments, but was in fact siphoned off to fund a lavish lifestyle which included property purchases and millions spent on prostitutes.

The scam began after he got away with stealing $40,000 he needed to pay back a credit card.

Andrea Versalko said the whole family were now dealing with the fallout. "I feel for Stephen's kids. We are all parents [and] everybody who has got that name has all suffered in different ways."

There are just seven families with the name Versalko in the phone book, four of them in Auckland.

"You're trying to protect your own family from it and it's being shoved in your face everyday. It's on the news and in the papers, it's everywhere you turn," said Andrea Versalko.

She said Versalko had seemed kind and sweet. "We're all victims of his lies and deceit and we all have to try and get on with it."

Stephen Versalko's children, university students aged 22, 20, and 18, had hidden their Facebook profiles and changed cellphone numbers to avoid media, the Sunday Star-Times reported yesterday.

ASB has refused to reveal details of how the country's largest employee theft went undetected for almost a decade, nor how bank processes have been altered to stop it happening again.

Banking Ombudsman Deborah Battell said yesterday that the bank was walking a fine line between reassuring its customers and avoiding releasing information that could help criminals repeat the offence. "You don't want to encourage any copycat crime."

The husband of one prostitute, who has name suppression, told the Sunday Star-Times the bank should drop a civil lawsuit over the $2,552,507 Versalko gave her during a long-term arrangement - during which he flew her on a luxury trip to Dubai - because the bank had been paid out by insurance.

But Ms Battell said: "That's self-serving rubbish. The bank has an obligation to recoup money even if they are ... covered by insurance."

Ms Battell said it appeared Versalko had run his own personal business from within the bank.

That might have made it easier to hide the fraud from customers.

Customers who lost money to Versalko have said he was the only person they dealt with at the ASB.

He has offered to help the bank and the Serious Fraud Office to prevent other rip-offs, the Sunday Star-Times reported.