Corrupt official gets home detention after dodgy Auckland Council deal for Chinese USB devices

Former Auckland Council worker Sundeep Rasila was sentenced today. Photo / Sam Hurley

A former Auckland Council worker will serve a period of home detention for a bribery case which "tarnishes New Zealand's current reputation" as a largely corruption-free country.

Sundeep Dilip Rasila was sentenced this morning after defrauding the local government body out of nearly $30,000 to help an old friend secure a nearly $150,000 Chinese tech goods contract.

Rasila, 42, was a procurement relationship specialist with the council from June 2012 to April 2016 and responsible for dealing with existing suppliers of goods and services.

The shady deal also involved 56-year-old commercial printing and office stationery supply businessman Sunil Chand and the allure of a $15,000 kickback.

Chand will be sentenced at a later date after disputing some of the Crown's case and now claims he was the whistleblower.

The pair earlier pleaded guilty to charges of bribery of an official and payment of secret commission.

Justice Graham Lang said corruption of this type had never occurred, or been revealed, in New Zealand before.

Rasila's offending, the judge said in the High Court at Auckland, had the potential to erode the public's trust in local government and raises questions about the robustness and integrity of local councils.

Sundeep Rasila and Sunil Chand, pictured in the High Court this morning. Photo / Sam Hurley

The ex-council worker's lawyer, Adam Holland, argued his client should escape a conviction because he had "already paid a pretty high price".

"His reputation has been essentially destroyed," Holland said. "It's hard to see how he can recover from that."

He said publicity surrounding the Serious Fraud Office (SFO) case meant Rasila had become almost unhirable in the procurement sector. Rasila also lost his job as a security guard last week after further media reports about the case, the court heard.

"Entering a conviction is going to do little more to hold him to account," Holland said, "while a discharge without conviction would give him a really small window to rehabilitate."

Rasila said in a pre-sentence report: "I take full responsibility for my actions and I am ashamed of myself."

Justice Lang said he accepted there were severe consequences to Rasila's offending but it was not out of proportion with the overall gravity of the offending, given it was a "form of corruption".

He declined to grant Rasila a discharge without conviction.

The judge said offending such as Rasila's was deliberately dishonest and "tarnishes New Zealand's current reputation as a place where public corruption is virtually non-existent".

He sentenced the former council worker to five and a half months' home detention.

A charge against Rasila of inducing or causing another person to "deliver over, execute, make, accept, endorse or alter" the contract for a pecuniary advantage was formally withdrawn today after the Crown offered no evidence.

After Rasila's sentencing, Auckland Council chief executive Stephen Town said his former employee's actions were inexcusable.

"As I have said previously, the council has zero tolerance for bribery, corruption or any kind of illegal behaviour and as soon as Mr Rasila's offending was brought to our attention we acted swiftly and engaged the appropriate authorities to ensure he was held to account for his actions," he said in a statement.

"Auckland Council has thousands of staff who take their responsibilities as public servants very seriously and I've no doubt they will be as disappointed as I was to learn that one of our staff could use such bad judgement and behave so poorly."

Town said he had confidence the appropriate processes were in place at the council to detect wrongdoing, including giving staff the channels and power to speak up when they suspect misconduct.

Court documents obtained by the Herald do not reveal exactly how Rasila and Chand's offending was uncovered, but Town has indicated it may have come from a tip-off.

"I'm very proud that a staff member did have the courage to speak up. It was absolutely the right thing to do and demonstrates to all our staff that when they do raise concerns, they will be taken seriously," he said today.

Auckland businessman Sunil Chand will be sentenced at a later date. Photo / Sam Hurley

Also in a statement today, the SFO said its investigation found this to be the only instance of a kickback being received by Rasila during his employment at Auckland Council.

"Corruption in the public sector diverts public funds from those who most need the support of public services. For this reason, public sector corruption is a high priority for the SFO," director Julie Read said.

"As a council employee, Mr Rasila was required to disclose the nature of his relationship with Mr Chand and his business, but he never did this. Mr Rasila's actions were deceitful, corrupt and criminal, and run counter to the fair way of doing business that New Zealand has a reputation for."

Details about the bribery case involving a deal for thousands of USB devices were reported last month after court documents were released to the Herald.

Rasila was involved in a USB procurement process for the council from its inception in 2015 and aware from discussions with management that the contract would be awarded to the lowest quote.

He told the council in September 2015 he could secure bulk amounts of USBs directly from China if they were ordered in tranches of no less than 10,000 units at a time, and in December that year contacted e-ville.com, an online wholesale company in China.

Despite advising the council the USBs would come directly from China, Rasila instead decided to contact his old friend Chand.

Prior to working at the council, Rasila was employed by a division of a commercial printing company called Soar Print Ltd (Soar Print). While there, he became friendly with Chand and even lived with Chand and his family.

After leaving Soar Print, Chand established his own commercial printing and office stationery supply company, On Time Print Finishers Ltd (On Time Print), which is now in liquidation according to Companies Office records.

A shady quote from On Time was prepared for the council, while Rasila and Chand agreed if the council gave On Time Print the contract the company would buy the USBs directly from E-Ville and then on-sell to the council, court documents read.

When Rasila provided the On Time Print quote to council, he withheld the original quote from E-Ville and deliberately omitted other lower priced offers from alternate suppliers.

A contract, valued at $152,250 for the supply of 22,000 USBs, was drafted and signed between Auckland Council and On Time Print in April 2016.

Because of Rasila's deceit, the initial contract cost the council about $27,150 more than other offers. The contract was later varied with the council's logo removed on each USB, reducing the value to $140,150, but On Time Print still made a profit of about $57,589.

After the delivery of the first tranche of USBs, Rasila asked Chand for a $15,000 kickback for facilitating the contract - wanting $7500 for delivery of the first tranche and another $7500 after the second.

Chand drew a cheque against On Time Print's account for $7500 to pay "Sundeep" in August 2018, which was later cashed by Rasila.

When spoken to by SFO investigators, Rasila admitted he received $7500 from On Time Print over the USB contract but made no further admissions. Chand, meanwhile, said Rasila approached him over the $15,000 payment and admitted he paid the bribe.