Accountant attempted to defraud wage subsidy scheme of more than $68,000
An accountant in Auckland has been sentenced to eight months of home detention for attempting to defraud the COVID-19 Wage Subsidy Scheme of more than $68,000, according to the Ministry of Social Development (MSD).
The accountant was identified as Brett William Knock, who provided services for various companies and individuals, including filing tax and Goods and Services Tax returns to the Inland Revenue.
The MSD said between March 28 and May 8 in 2020, Knock made 12 fraudulent wage subsidy applications to the ministry.
All 12 applications listed Knock as the contact person and nominated the same bank account, but none of the directors and shareholders of the firms ever receiving any wage subsidy funds from him, according to the MSD's media release.
Knock told the MSD that he had obtained verbal instructions from his clients to apply for wage subsidies on their behalf, but he admitted that he didn't check if his clients were eligible.
Out of the 12 fraudulent applications, eight were successful, amounting to $40,629.60 in total. The unsuccessful ones were worth an additional $28,000.
Home detention
The MSD prosecuted Knock following his attempts as part of its ongoing Wage Subsidy Integrity and Fraud Programme.
Knock appeared at the Auckland District Court on December 19, 2023, where he admitted to 10 charges of dishonestly taking or using a document.
Judge Simon Lance sentenced Knock to eight months of home detention, giving consideration to his remorse and efforts at rehabilitation, as well as guilty plea.
Knock has also repaid $36,429.60 of the total wage subsidy funds that he received from the MSD, which the court also considered, according to the ministry.
Wage subsidy misuse
So far, 39 people have been brought to the court by the MSD for wage subsidy misuse, in relation to more than $3 million in subsidy payments. Under the Wage Subsidy Integrity and Fraud Programme, the MSD is searching for employers who received wage subsidy that they weren't entitled to.
"Our programme of work includes investigations, post-payment checks, requests for repayment, civil recovery, and in the more serious cases, prosecutions where there is evidence deliberate fraud was involved," the MSD said on its website.
The wage subsidy is part of the government's measures to support businesses that were affected by COVID-19 restrictions.
The subsidy provides employers with funding so they can continue paying their employees and prevent job losses and business closures.
According to the MSD, about $18.8 bullion was delivered in 2020 and 2021 for wages for more than 1.8 million jobs.