Monday, June 24, 2024

Jail for $200,000 COVID wage subsidy fraudster

A man has been sentenced to 20.5 months in prison for defrauding taxpayers to the tune of almost $200,000 in COVID-19 wage subsidies, the Ministry of Social Development announced today.

Nathan Peter Irvie Downey appeared for sentencing in the Manukau District Court on 25 August, having admitted 13 charges of dishonestly taking or using a document.

Between 23 March and 24 August 2020, Downey submitted 19 fraudulent wage subsidy applications for Protective Systems Limited (PSL). At the time, he was the sole director and shareholder of the company, which uses contractors to provide painting and fireproofing services.

Thirteen of the 19 applications were successful, totalling $196,076.

Several people were named as employees of PSL on the applications, including Downey. However, subsequent checks by MSD found that PSL had no employees and was not a registered employer. It also transpired that some of the people named in the applications did not exist.

The company’s bank statements showed it paid $74,363.73 to contractors during the period Downey received the wage subsidy funds, and about $17,896.15 of that went to his personal bank account. The company was generating varying degrees of income during this period.

Downey spent the remaining $121,712.27 on company and personal use, including online gambling, adult entertainment clubs, and fast food.

Downey made several other unsuccessful wage subsidy applications totalling $66,781.20. Between March and June 2020, he was also receiving the wage subsidy as a full-time employee of a company run by his mother.

Judge Mina Wharepouri noted that the offending involved a high level of planning and premeditation, with Downey taking “whole hog advantage” of the system.

The offending was “more exploitative” than some other types of fraud given the Wage Subsidy Scheme was intended to address a national emergency, the Judge said.

Downey was sentenced to 20.5 months’ imprisonment.

He has filed an appeal against his sentence, which will be heard in the High Court at Auckland on 15 September 2023.

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