Murderer and prison escapee Phillip John Smith sentenced for Covid-19 dishonesty charges from prison

Philip Smith during his escape from New Zealand in 2014.

Infamous prison escapee and murderer Philip John Smith has admitted to using a Covid business-support loan to commit dishonesty offences from prison.

Smith, 47, appeared in the Wellington District Court by AVL today, where he pleaded guilty to 19 charges of dishonestly using a document for pecuniary advantage.

He was sentenced to 24 months’ imprisonment to be served concurrently and ordered to pay $53,593.41 in reparations to IRD.

The money will be repaid at a rate of $100 a week for the next four to five years.

Smith has been in prison since 1995, when he murdered the father of a young boy he was convicted of sexually violating. He made international headlines in 2014 when he fled to South America while on temporary release from jail.

The audacious escape was short-lived, with a tourist recognising Smith in a hostel in Rio de Janeiro, having seen him on the news. He alerted police and Smith was brought back to New Zealand.

He is now before the courts again for exploiting a “high trust” scheme designed to help small businesses survive the initial stages of the Covid-19 pandemic.

Smith used the scheme to dishonestly claim more than $66,000 from the Government, the summary of facts said.

In April 2020, the Government announced a small business cashflow loan scheme to support small businesses impacted by Covid.

The “high trust” scheme used a similarly high trust application model to ensure businesses could quickly obtain funds when needed.

Smith created five new companies with the New Zealand Companies Office, though he was not named as a shareholder or director in them. Friends, associates, and other third parties were named as shareholders and directors, the summary said.

He then used his newly-created businesses to apply for loans and file false GST returns. The Inland Revenue Department (IRD) began investigating and discovered the companies had no business activity at the time of filing returns or making the loan application, and had no employees.

Smith attended a voluntary interview with the IRD and told them he had granted a person authority over his bank accounts, and that they should speak to that person. However, IRD was unable to find any records of this person. In total, $66,197.62 was paid out, of which Smith received $53,593.41. Some of the money went into the bank accounts of his friends and associates.

After being charged with the dishonesty offences, Smith applied for name suppression on the grounds that if his name was published in relation to the offending it would prejudice his fair trial rights.

He argued his high profile, combined with repeated media reporting in the lead-up to a possible trial, would prejudice a potential jury against him.

NZME opposed suppression.

Judge Noel Sainsbury granted interim name suppression until trial, or until a guilty plea, meaning today Smith can be named due to his guilty plea.

Vita Molyneux is a Wellington-based journalist who covers breaking news and stories from the capital. She has been a journalist since 2018 and joined the Herald in 2021.