Kate Carter, 43, of Hamilton, narrowly avoided jail after admitting her role in stealing $726,000 from her former employer, NZAgbiz. Photo / Belinda Feek
The manager of a dairy products company run by Fonterra duped her employers out of more than $720,000 by on-selling expensive milk powder and labelling it as cheaper product.
Hamilton mother Kate Carter, 43, today narrowly avoided a jail sentence for her dishonesty.
Instead, she will spend the next 12 months’ serving a sentence of home detention, a fall from grace from a lifestyle that once included home improvements and holidays.
Another former employee accused alongside Carter continues to defend the charges and will go on trial in the Timaru District Court later this year.
Carter began working at NZAgbiz in October 2008 as a logistics planning co-ordinator.
NZAgbiz is a wholly owned subsidiary of Fonterra and has its head office in Te Rapa, along with processing factories in Waharoa and Temuka.
The company buys products, including whole milk powder and buttermilk powder from Fonterra and other factories, and processes them into animal nutrition products including calf milk replacers.
By 2015, she was promoted to raw materials manager putting her in charge of purchasing refrigerated goods from dairy manufacturers and on-selling them as well as any milk powders.
She resigned in August 2019 after being told of the investigation into her actions.
Carter’s co-accused also worked at NZAgbiz from 2008 but left in 2013 to start her own company, which bought dairy products and processed them into another product.
Carter earlier pleaded guilty to five representative charges of causing loss by deception for the theft.
She accepted that between February 1, 2018, and September 3, 2019, she was involved in 62 transactions to sell 1530 metric tonnes of dairy products from NZAgibz for a “significantly lower than market price”.
She then used her ill-gotten gains to fund her “lifestyle”, home improvements, holidays, and “day-to-day living”, the Hamilton District Court heard today.
The total loss to NZAgbiz was $726,057 while Carter was paid $449,293 “salary” payments from the co-accused’s company.
Of the 62 sales, 22 involved invoice and sale order data being changed to sell a product under incorrect descriptions.
Forty sales involved invoice and sale data being changed with the original Fonterra text invoice left unaltered.
“In essence what you were doing was on-selling product to [the co-accused’s] company and much cheaper product in exchange for PAYE payments from her to you, causing a loss to NZAgbiz,” Judge Kim Saunders told Carter during her sentencing.
Police prosecutor Brendon Mills described Carter’s offending as “cynical, calculated and deliberate” and took exception to defence counsel submissions labelling it “opportunistic”.
“With respect ... it’s cynical, it’s calculated, it’s pre-meditated, it’s substantial ... and has occurred over a lengthy period of time.”
He also accepted Carter’s decision to give evidence for the prosecution at her co-accused’s trial would “be significant”.
Defence counsel Tom Sutcliffe said his client was genuinely remorseful and was prepared to do anything to prove that, including working with police at her co-accused’s trial.
“The first day police spoke to her she was an open book ... she gave a full and frank explanation about how this had been perpetrated.”
She had also met with senior members of Fonterra’s executive to work out the extent of the losses suffered.
“Her remorse is frankly palpable and she’s deeply ashamed.
“In a moment of weakness, at a time in her life when she was experiencing some difficulties, she gave in to the temptation to get involved in this and it really snowballed.”
Carter had also entered into a settlement agreement with NZAgbiz relating to paying back her share of the stolen money.
She was now working as a cleaner.
A pre-sentence report found she was at a low risk of reoffending and harm to others.
Judge Saunders noted Carter’s offending had been “keenly felt” by her former employer and employees on an emotional level.
“It’s caused a great deal of stress and anxiety,” the judge said. “It’s a small, tight-knit unit with only 27 staff so you were very much a valued and trusted member of a small company.”
She accepted Carter prior to this offending was otherwise known as someone who was “highly trustworthy and reliable”, who had not offended before but now faced having to help her children reconcile what she had done.
“They are sad, they are devastated by the knowledge of what you did.
“And how they reconcile what they know of their mother with that is something that you are going to have to work through.
“But equally knowing if you were caught that it was going to have an effect on your family didn’t stop you. So there are two ways of looking at that, Ms Carter.”
Judge Saunders said however when the fraud began Carter knew what she was doing was dishonest.
After taking a starting point of four years and six months’ jail, Judge Saunders applied various discounts for an early guilty plea, remorse, previous good character, and co-operation with police to come to an end sentence of 12 months’ home detention.
Belinda Feek is an Open Justice reporter based in Waikato. She has worked at NZME for eight years and been a journalist for 19.