CIO on trial: Otago DHB fraud case in High Court

The former CIO of the Otago District Health Board is facing fraud charges in the Dunedin High Court in a trial scheduled to last three weeks. Mike Swann and a Queenstown-based associate, Kerry Harford, each face three charges alleging $16.9 million in fraud relating to IT licences and support contracts.

Swann was sacked for “gross mismanagement” on October 19, 2006, after having been suspended on full pay. Both men deny the fraud charges.

The DHB has also lodged a civil claim seeking damages.

The charges relate to payments allegedly made between 2000 and 2006 for insurance, software licences, service and support to Harford's company Sonnford Solutions Limited and Harford Sonntag and Associates. Ninety percent of these payments were allegedly then paid to another company, Computer South Limited, with links to Swann and his associates.

Media revelations during the high-profile investigation included Swann owning or part-owning a 50-metre luxury yacht and driving a number of luxury cars.

"I believe I declared everything. People are saying [the companies] were set up for the hospital. That's not true. And it's not fair to say I benefited from these things because I haven't taken any money from [the district health board]. How far do you have to go before the district health board money stops being its money?" Swann said in a 2007 interview with the Sunday Star Times.

He said the contracts passed audit for seven years.

To suggestions there were plasma TV screens in each of the yacht's 17 bedrooms, he responded that there was one $2,500 plasma television. The other 16 rooms had $750 LCD TVs.

Fairfax Business Media