Versalko sex worker 'entitled to the money'

The sex worker paid more than $2.4 million by ASB fraudster Stephen Versalko is entitled to the money as it was earned in a private client arrangement, says a prostitutes' lobby group.

The ASB is suing the mother of one, who has name suppression, to recover some of the $17.8 million Versalko stole over nine years.

He spent most of the money on property and lifestyle - including paying at least $3.4 million to two prostitutes and showering them with $800,000 of gifts.

He met one of the women at the Pelican Club brothel in Auckland, which charges clients $210 an hour or up to $1500 a night - although the women there earn considerably less than that.

On this basis, the ASB is suing the prostitute for the $2.4 million Versalko paid her, claiming it was impossible for her to earn the money based on her hourly rate. The bank has taken a legal order over her $800,000 lifestyle block, claiming it was bought with funds belonging to ASB.

The caveat of "institutional constructive trust" means the prostitute has legal title over a property she was only able to pay for with money she did not deserve.

But although she met Versalko at the Pelican Club, a sex industry source said the brothel had nothing to do with the $2.4 million paid to her.

The source said the prostitute was an independent contractor and the private arrangement with Versalko happened outside the brothel premises after the initial meeting. On one occasion, Versalko took the woman on a business trip to Dubai to stay at a $2000-a-night hotel.

Catherine Healy, of the New Zealand Prostitutes Collective, said although the woman got an hourly rate at the Pelican Club, she was also an independent contractor, who could charge any price she wanted.

"Private arrangements may be initiated at the first point of contact, but who can say it was just contained at the Pelican Club?

"All sorts of the most remarkable arrangements come from private client relationships and this [Versalko case] is one of those," said Ms Healy.

"It's rare, but not uncommon, to hear of clients paying huge sums of money or buying houses for them."

Roy King, owner of the Pelican Club, did not return messages.

The woman at the centre of the lawsuit declined to comment for fear of jeopardising her legal case.