Photo: Work and Income
A beneficiary who claimed Covid support for businesses that were not active is among three people who have been in court recently due to fraud-related pandemic payments, Inland Revenue says.
Auckland woman Kesalina Hakaraia was sentenced to six months' community detention.
She told IR in April 2020 that she was self-employed and had been since 2019.
In May 2020, she filled out an income tax return for the 2020 income year, which included her benefit income, nearly $6000 in self-employed earnings and $25,000 in expenses, resulting in an income tax refund of $2528.43.
On 14 June 2020, she amended her auto-calculated income tax return for the 2019 income year, claiming that she had earned $9800 and had incurred expenses of $22,800. This increased her tax refund by $1775.34.
The information in her 2020 income tax return and 2019 income tax return amendment were false and provided deliberately to get increased income tax refunds, IR said.
In May and June of 2020, Hakaraia incorporated three companies and applied for small business cashflow scheme loans in the name of each of them, each time declaring that the company was operating a viable business and had suffered a 30 percent decline in revenue because of Covid.
All of the applications submitted were false, IR said, because none of the companies had any business activity. The department said the offending was premeditated and occurred over about 10 months.
The total amount of income tax refunds wrongfully obtained by Hakaraia was $4303.77 as well as $11,800 in small business cashflow loan funds.
The judge ordered her to pay reparation of $16,103.77 at a rate of $20 per week.
In another case, south Auckland man Samuela Aki dishonestly applied for six small business cashflow scheme loans, four resurgence support payments, and two small business cashflow to-ups, even though he knew he was not entitled to any of them.
The small business cashflow scheme was set up during the pandemic to provide low- and no-interest loans to business that were affected.
Aki pled guilty and was sentenced in the Manukau District Court to eight months' home detention.
Of the six loans Aki applied for, four were approved and two declined. The total amount paid out was $47,200.
All four of the resurgence support applications, as well as the top-up applications, were declined.
Aki also filed two false income tax returns.
IR's investigation found he applied for the Covid relief and the income tax refunds using other people and businesses log-ons and used his personal bank account for the money to be deposited into.
Aki was also sentenced on police charges including six charges of obtaining by deception using a Facebook scam.
In the third case, Hawke's Bay man Dion Colin Thorne was sentenced to seven-and-a-half months' home detention and ordered to pay $5000 reparation for filing false GST claims and applying for a small business cashflow scheme loan that he knew he was not entitled to.
Thorne owned and ran Denali Hair and Beauty Clinic which ceased business in March 2017. But between that time and April 2019, he filed 26 GST returns and claimed $52,474.76 in refunds.
IR started investigating Thorne in January 2019 and tried to interview him but he did not come forward, the department said.
In April 2020, he applied for $11,8000 from the small business cashflow scheme and was declined.
An IR spokesperson said there were more cases coming through the court system relating to Covid payments.
