A multi-million dollar fraud trial is under way in Dunedin involving the former IT manager of the Otago District Health Board.
The Crown says Michael Swann and his friend Kerry Harford defrauded the health board of almost $17 million by issuing false invoices from their own company.
For eight years, Swann was the Chief Information Officer at the Otago District Health Board. He was sacked in late 2006 for "gross mismanagement".
The Crown alleges Swann used his position to approve invoices for IT services, supposedly delivered by a company owned by his friend Kerry Harford, a property surveyor with no IT experience.
"On receiving payment for the invoices, Harford promptly deducted 10 percent of the amount and forwarded the remaining 90 percent onto Swann," says Robin Bates, Crown prosecutor.
At a depositions hearing last year it was alleged Swann had been living a life of luxury, with grand properties in Dunedin and central Otago along with a collection of luxury cars and a 50m yacht with televisions fitted in each of its 17 bedrooms.
The Crown says for six years the pair did little more for that $17 million than creating nearly 200 false invoices, never supplying any of the services or software the board was charged for.
"Any work which was being done on the computers at the hospital - and it was minimal in any event, essentially just to keep the systems running - was being done by the paid employees at the hospital," says Mr Bates.
Defence lawyers for both Swann and Harford claim there was no intent to defraud the health board. They say the invoices were for risk mitigation services, and fees were "not excessive".
Swann and Harford have each pleaded not guilty to the fraud charges.
The Crown plans to call over 40 witnesses, with the trial set to last three weeks.
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