‘Dishonest and merciless’ tax offender

The director of a business showed he was “thoroughly dishonest and merciless” with a series of fraudulent GST claims for a company that was not even trading, a judge said.

James Logan Bennett, 35, was sentenced to home detention and community work after admitting he claimed fraudulent GST returns nine times totalling $132,780.

Bennett told the IRD he was trying to prop up his company called Rainbow Pages NZ Ltd which provided marketing for gay and lesbian businesses, but the company had not been in business for some time.

IRD prosecutor Virginia Diefenbach said Bennett claimed the GST on over $1 million with entirely fictitious reports.

She said it was unsophisticated and short term offending by a man with good financial skills. He manipulated GST returns to get high refunds and got comfortable with his fraud, and the claims started getting higher.

Defence counsel Nikita Mitskevitch said Bennett thought he could get to a point with his business where he could right this wrong. The offending was a complete fall from grace where things spiralled from bad to worse, and Bennett wished to apologise for the damage he had done.

Bennett was willing to pay reparation but Judge Kevin Phillips said Bennett was on a sickness benefit so that would mean taking the money from Social Welfare and giving it to the IRD.

Judge Phillips said Bennett had totally destroyed the other director’s life by his offending. She had given him the money to set up the business on the promise of his uncle’s trust fund being paid out.

He said Bennett took the woman’s money, her car, and her income, until he couldn’t squeeze any more out of her and then he went to the IRD.

The woman was faced with a debt collection agency, and had members of gangs coming to her door because of Bennett’s drug problem.

He said Bennett was thoroughly dishonest and merciless, and he looked at the woman’s report and then looked at the letter Bennett had written to him and he didn’t believe any of his account.

Judge Phillips said the offending was only of nine months’ duration because it was nipped in the bud by IRD  as Bennett increased the amount on a monthly basis that he was claiming.

He was being sentenced for filing nine false GST returns and using a tax invoice he manufactured for $21,000 for Rainbow Pages NZ Ltd.

The victim was the New Zealand public, Judge Phillips said, and the money was used for drugs and a lifestyle Bennett wanted to maintain in Auckland.

Bennett lost his good character on the day he filed his first claim, he said.

He sentenced Bennett to nine months’ home detention and 300 hours of community work. He made no reparation order.