Former council manager accused of awarding $7m contract to friend goes on trial

The trio appeared at the Christchurch High Court on a total of 48 charges brought against them by the Serious Fraud Office, relating to what the Crown describes as "corrupt conduct". Photo / NZME

A former council manager who awarded a $7 million contract to a cake decorating company to build a sewage plant, acted as an "inside man" to advantage companies he had relationships with.

That's the allegation by the Crown against Vivek Goel, who is on trial in the High Court at Christchurch with co-accused Amar Singh and Ashesh Sevta for "corrupt conduct" when Goel worked at Westland District Council.

Singh and Sevta were businessmen at the time in 2016 and the trio face a total of 48 charges following a 2017 Serious Fraud Office [SFO] investigation into their activities.

Goel wrote tenders to ensure certain companies would secure contracts over others, according to opening submissions from the Crown today.

One of the contracts involved a $7 million sewage plant project to be built in Franz Josef in 2016 after the previous one was wiped out by a flood.

The contract was awarded to start-up South Auckland company Techno Economic Services, run by a cake decorator.

Goel was the council assets manager when he invited the company's director to tender for the contract and helped form its application, the Crown claims, despite the company having no previous experience providing waste management or construction services.

Goel faces 15 counts of corruption and bribery of official information, four counts of corrupt use of official information and two counts of obtaining by deception, all of which he pleaded not guilty to.

Singh faces 15 counts of corruption and bribery of official information, one count of corrupt use of official information, one count of obtaining by deception and nine counts of offence to obstruct investigation etc. He pleaded not guilty to all the charges.

Sevta faces one count of obtaining by deception which he pleaded not guilty to.

Crown prosecutor Anne Toohey said councils spend a lot of money on infrastructure and there had to be a fair and proper process in awarding contracts.

But even with sound processes in place, it was always possible for "corrupt employees" to give an advantage to certain companies where relationships are involved, Toohey told the jury.

She said the three defendants were all involved in "cheating the system" and in doing so, committed criminal offences.

The jury heard both Singh and Sevta were invited to Goel's wedding in India.

The trial will hear evidence involving three contracts for which Goel is alleged to have helped write tenders for, to ensure certain companies would secure the contract over others.

The Crown also said Goel shared confidential information about the strategies of certain companies, aiming to secure the contract with companies that he had undisclosed relationships with.

Singh allegedly paid Goel in exchange for information on how to secure council tender contracts.

Singh told investigators his cash withdrawals were used on personal matters such as his grandson's birthday, travel and construction, however, the SFO could not find any evidence of this.

The Crown described Goel as a "stickler for the rules" which it said was a facade to hide the fact that he continued to break them.

The trial continues tomorrow with openings for the defence.