Trial finds behaviour to be corrupt

By on December 9, 2016

A Serious Fraud Office (SFO) trial of two men on corruption and bribery and fraud charges has reached a verdict in the Auckland High Court today.

Stephen James Borlase and Murray John Noone have been found guilty of Crimes Act charges of ‘Corruption and bribery' relating to more than $1 million of fraud which took place between 2005 and 2013 at Rodney District Council and Auckland Transport. Mr Borlase faced eight charges and Mr Noone faced six charges.

Mr Borlase was also found not guilty of four Crimes Act charges of ‘Dishonestly taking or using document'.

While in senior management roles at Rodney District Council and Auckland Transport, Mr Noone received undisclosed payments and gratuities from Mr Borlase who was the director of Projenz Ltd, a supplier to Auckland Transport and Rodney District Council. The gratuities often came in the form of travel, accommodation and entertainment.

SFO Director, Julie Read said, "It appears that within the road maintenance division during this period the acceptance of gratuities was considered the norm. All of us need to recognise that corrupt activity is at risk of gaining momentum if business turns a blind eye. That sort of behaviour cannot be tolerated if we are to continue to promote New Zealand as a safe place to invest and do business."

Another defendant, Barrie Kenneth James George pleaded guilty in August for his part in the matter. Mr George received a sentence of 10 months on home detention.

Mr Borlase and Mr Noone will be sentenced in the Auckland High Court on 22 February 2017.

 

For further media information

Andrea Linton
Serious Fraud Office
027 705 4550

BACKGROUND TO INVESTIGATION

Auckland Transport is a Controlled Organisation (CCO) of Auckland Council. The organisation combines the transport expertise and functions of eight local and regional councils and the Auckland Regional Transport Authority (ARTA).

Auckland Transport is responsible for all of the region's transport services from roads and footpaths, to cycling, parking and public transport.
Rodney District Council was disestablished in October 2010 to become part of Auckland Council.

Projenz was set up in 1997 by Mr Borlase. Projenz provided engineering services and had supply contracts with Rodney District Council and then Auckland Transport in relation to the maintenance and renewal of the roading network in the Rodney and Auckland regions.

CRIMES ACT OFFENCES

Section 105 Corruption and bribery of official
(1) Every official is liable to imprisonment for a term not exceeding 7 years who, whether within New Zealand or elsewhere, corruptly accepts or obtains, or agrees or offers to accept or attempts to obtain, any bribe for himself or herself or any other person in respect of any act done or omitted, or to be done or omitted, by him or her in his or her official capacity.
(2) Every one is liable to imprisonment for a term not exceeding 7 years who corruptly gives or offers or agrees to give any bribe to any person with intent to influence any official in respect of any act or omission by him or her in his or her official capacity.

Section 228 Dishonestly taking or using document
Every one is liable to imprisonment for a term not exceeding 7 years who, with intent to obtain any property, service, pecuniary advantage, or valuable consideration,-
(a) dishonestly and without claim of right, takes or obtains any document; or
(b) dishonestly and without claim of right, uses or attempts to use any document.

ABOUT THE SFO

The SFO was established in 1990 under the Serious Fraud Office Act in response to the collapse of financial markets in New Zealand at that time.

The SFO's role is the detection, investigation and prosecution of serious or complex financial crime. The SFO's focus is on investigating and prosecuting criminal cases that will have a real effect on:

  • business and investor confidence in our financial markets and economy
  • public confidence in our justice system and public service
  • New Zealand's international business reputation.

The SFO operates three operational teams; the Evaluation and Intelligence team along with two investigative teams.

The SFO operates under two sets of investigative powers.

Part 1 of the SFO Act provides that it may act where the Director "has reason to suspect that an investigation into the affairs of any person may disclose serious or complex fraud."

Part 2 of the SFO Act provides the SFO with more extensive powers where: "...the Director has reasonable grounds to believe that an offence involving serious or complex fraud may have been committed..."

In considering whether a matter involves serious or complex fraud, the Director may, among other things, have regard to:

  • the suspected nature and consequences of the fraud and/or;
  • the suspected scale of the fraud and/or;
  • the legal, factual and evidential complexity of the matter and/or;
  • any relevant public interest considerations.

The SFO's Annual Report 2016 sets out its achievements for the past year, while the Statement of Intent 2014-2018 sets out the SFO's strategic goals and performance standards. Both are available online at www.sfo.govt.nz

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