Attempts by disgraced Heart of the City boss Alex Swney to hide assets in trusts and prevent the ratepayer-funded organisation recovering millions of dollars he stole have been thwarted, inner-city business association said today.
The High Court at Auckland said yesterday a civil claim filed by Heart of the City
against Mr Swney and two trusts associated with him had been settled.
The action had named as a defendant Swney's wife, Angeline Marshall as trustee of the Country Style and Swney-Marshall trusts, but the Heart of the City cleared her of any wrongdoing.
"Heart of the City has not alleged that the present trustees of the trusts had actual knowledge of the transfer of the funds by Mr Swney," a spokesperson for Heart of the City said in a statement.
The settlement marks perhaps the final chapter in the spectacular fall from grace for Mr Swney, who went from being a high-profile mayoral candidate a decade ago to his currently imprisonment and bankruptcy following an admission earlier this year to multi-million dollar frauds spanning nearly a decade.
Swney, who founded and served as the ratepayer-funded organisations' chief executive, was sentenced to five years in prison in June after pleading guilty to stealing $2.5 million from Heart of the City, and the non-payment of $1.7 million in tax.
The charges concerned Swney's use of false invoices to top up his modest official salary by stealing hundreds of thousands of dollars each year, and also his failure to pay any tax on either his legitimate or illicit income.
In June, Heart of the City chairman Terry Gould said the civil action was intended to "recover as much of the stolen money as possible," he said, but the ratepayer-funded organisation was yesterday unwilling to comment on how much - if any - the civil action had eventually netted.
In a statement a Heart of the City spokesperson said: "The settlement terms of confidential and are without any admission of liability, but Heart of the City is comfortable that the settlement provides for recovery of the large majority of the money that it claimed was transferred by Mr Sweney into the particular trusts."
Despite the information blackout, any financial payments to the publicly-funded organisation is legally required to be disclosed when Heart of the City files financial returns later this year.
The memorandum disclosing the settlement from Justice Raynor Asher reinforced the veil of secrecy covering the action, ruling the case file would remain closed.
The Herald has earlier reported the case was covered by a mysterious suppression order that court staff were unwilling to detail.
