The New Zealand company which pioneered cutting-edge internet graphics for the America's Cup was shut down after an executive stole almost $600,000 from its accounts.
Adelmar Bruno Jardim was the senior account manager for Virtual Spectator International, which earned rave reviews for computer graphics that allowed online audiences to follow the action at the 2000 and 2003 regattas.
The software developers picked up global contracts from the America's Cup success, including the World Rally Championship and Volvo Ocean Race, but was shut down in 2010 after fraud was accidentally uncovered.
Jardim earned $160,000 a year but was this week convicted of 10 dishonesty charges totalling more than $600,000 and was remanded in custody to be sentenced in November. The fallout from the five-year fraud was devastating for the company.
The frequent siphoning of funds meant Virtual Spectator did not spend money on improving its products and technology-wise began to fall behind rival developers.
The fraud made the business unprofitable and the international investors blanched at spending millions to make the company competitive again. Around 10 staff lost their jobs. "It's a real shame," said one former staff member who spoke anonymously. "It makes me sad because you'll hear the (current America's Cup) commentators say 'isn't Virtual Spectator fantastic?'. But it's not us anymore. They had a really brilliant bunch of people working there and (Jardim) destroyed it."
Court documents obtained by the Weekend Herald reveal how Jardim manipulated clients and his employer into thinking they were paying for work, but were in fact funnelling money directly into bank accounts controlled by him.
The 44-year-old would supply invoices on an official Virtual Spectator letterhead and ask for the money to be paid into a bank account titled VS New Zealand. Clients wrongly assumed that the "VS" stood for Virtual Spectator and Jardim was the sole signatory to the account.
Jardim also operated two companies, Caidan Enterprises and Clip the Ticket, which purportedly completed $100,000 of projects for Virtual Spectator. In fact, the graphics company was paying Jardim for work completed by their own staff.
Jardim also invoiced clients in Britain and United States to make payments to his Caidan entity. He was also the only liaison point with a firm which subleased a part of Virtual Spectator's premises in Newmarket and the rent was paid directly into the Clip the Ticket account.
The fraudulent behaviour started in 2005 and was uncovered in 2010 after representatives from North One Television, contracted to the World Rally Championship, claimed they had been making payments which Virtual Spectator had not received. An urgent forensic analysis of the accounts exposed the deception and a detective from the Auckland financial crime unit discovered the fraud was much larger than first thought.
Jardim will be sentenced in the Auckland District Court in November.
Virtual Spectator International Ltd merged and then split from Animation Research Ltd, another Kiwi company which has created the real time 3D graphics for television audiences in the America's Cup since 1992 and produces the 'Virtual Eye' for the current regatta.
Adelmar Jardim, 44
• Convicted of 10 counts of "dishonestly using a document to obtain a valuable consideration".
• Stole more than $600,000 from Virtual Spectator over five years.
• "They had a really brilliant bunch of people working there and [Jardim] destroyed it" - former Virtual Spectator International employee.