Board not double-charged for hotel, court told

Press, Volume CXIV, Issue 33463, 19 February 1974, Page 2

Board not double-charged for hotel, court told

(New Zealand Press Association) WHANGAREI, February 18. The Northland Harbour Board was not double-charged for London hotel accommodation in May and June, 1970, accordin g to its planning officer, John Arnold Lyall.

His explanation of accounting for that trip with the board’s chairman, Ralph Kraeft Trimmer, was presented to the Whangarei Magistrate’s Court today by the Assistant AuditorGeneral (Mr G. H. Rush). The explanation was contained in a statement prepared by Lyall last April, when Mr Rush was in Whangarei investigating board affairs. The board, its chairman, and two senior officers face 24 charges, of which 17 are joint charges, making 42 informations in all.

No pleas have been taken yet. Trimmer, aged 73, of Whangarei, faces five charges of theft by failing to account, including two joint charges, and two joint charges of uttering, all of which come under the Crimes Act. He also faces four charges of breaching the Secret Commissions Act, 1910, including three joint charges of breaching Reserve Bank exchange control requirements.

Lyall, aged 43, of Whangarei, faces two charges of theft by failing to account, including one joint charge, one of false accounting by an employee, two charges of forgery, two joint charges of uttering, two joint charges of breaching the Secret Commissions Act and one joint charge of breaching exchange control requirements. James Stuart Mason, aged 52, of Whangarei, tne board’s engineer, faces two charges of theft by failing to account, including one joint charge of breaching the Secret Commissions Act. The harbour board itself faces eight joint charges of breaching exchange control reouirements.

The charges relate to offences alleged to have occurred between February, 1968. and November, 1972.

Report discussion

In his statement, Lyall said he had not been invited to discuss a statement from William Coward and Company, Ltd, the board’s London agent, for the quarter ended June 30, 1970, which was the subject of a report to the board in February, 1973.

“If Mr (A.G.) McHugh (the board’s internal auditor) had asked me for any specific sums of money and said he needed it to satisfy himself as the board’s auditor, I would have paid the money straight away.

“When Mr Peter Scott chairman of directors of Cowards, was in Whangarei in February, 1971, Mr McHugh said he discussed the suspense account arrangement with him. The chairman and I were not present when he did so. “Mr McHugh stated in his report of February 15, 1973, that Cowards was prepared to ensure that funds were available. Those discussions he had with Mr Scott must be the origin of the fund, which eventually reached £2162.54 and which has now been returned to New Zealand.” Offer alleged Cowards had at all times emphasised that it was willing to help any of its clients when travelling from countries granting restricted travelling allowances, said Lyall’s statement. “This led me, in May-June, 1970, to ask Mr Peter Corfield (manager of Cowards) whether Cowards could meet the Cavendish Hotel account. He said he would sort it out.

“I knew for nearly two months before I left New Zealand on April 24, 1970, that I would be travelling through Tokyo to London, where I was to meet Mr Trimmer on harbour board business.

“At that time, it was not difficult to obtain overseas currency in and around Whanagrei. The result was that by the time I left New Zealand I had the equivalent of SUSBOO in English, Australian and American money.

Rising charges / Just before May, 1970, overseas hotel and restaurant charges were rising rapidly. “The Reserve Bank allowance over the year had not previously been sufficient for me to carry out my duties on behalf of the board, and by this time. May, 1970, it was still more difficult to do so within the allowance.

“On all occasions I have been to Britain or Europe or the United States on board business I have found the Reserve Bank allowance inadequate to cover my expenses.” Lyall’s statement said that after he had been in London a week or two, it became apparent that he would have to conserve his funds carefully because he had still to get home through the United States. <

“I had myself paid for a number of lunches in entertaining people, which were in fact on behalf of the board.

, “As the time approached for departure, I therefore raised the question with Cowards as to whether they could meet the Cavendish account. They made the appropriate arrangement with the hotel.” Lyall’s statement said he became concerned about the amount of the bar account, which became inflated “because of the number of people we could not avoid entertaining there.” "Rightly or wrongly, I thought it might be wise for us to have the Cavendish accounts that only contained the room and meal accounts, I fancied that not only would such accounts be more acceptable to the board, but they would not infringe on the board’s unauthorised expenditure. “I can now see that the whole idea was ill-conceived. However, it did not result in my obtaining any more board money, because by the time I got back to New Zealand I had none of my own funds left. “Understandable” "Mr Trimmer was not a party to the arrangement. When presented with the receipted account in the Cavendish bar, he did in fact take out his traveller’s cheque book and commence to sign. “Under all the circumstances that existed that day, I can understand Mr Trimmer’s belief that be paid his account for £207 while in the bar.

"In the end, therefore, no additional board moneys have been used, nor have any been misapplied. The fault lies in misdescribing in my travel account a conglomeration of expenditure incurred on board business, under one simple but erroneous heading of payment to the Cavendish Hotel.

“Without wishing to get any of the employees of the Cavendish Hotel into trouble, I must explain that it was Mr Peter Corfield who prevailed on one of the clerks to give him a Cavendish account excluding the bar and incidental items.”

The existence of the reduced account did not mean that there had been any double-charging against the board, said Lyall’s statement.

The whole purpose had been to stretch the overseas allowance “to the very limit." *Lj*¥ t!* 51 beco “b!g depleted. The payment cf the hotel account by Cowards freed Lyalls funds for the return trip. '“The chairman, Mr Trimmer, and his family, are

of very substantial means. He is accustomed when travelling overseas with Mrs Trimmer on their own account, to have a standard of ’ comfort well above the average. "The result is that when a member of the board or of the staff travels overseas with the chairman, it does result in his companion incurring greater expense than if the companion were travelling alone. “In one way or another, this is also caused by the fact that the chairman is well known in every port of importance in the' world. He has countless friends overseas and entertaining them and returning their hospitality cannot help but be reflected to some extent on his travelling companion,” Lyall was reported by Mr Rush as saying.

Detective Senior-Sergeant E, M. Jones, of Whangarei, said he began to investigate the travel expenditure of board members and executive staff in May, 1973. After comparing two Cavendish Hotel receipted accounts with harbour board documents, he obtained a search warrant which he executed on the board’s premises. The board’s treasurer (Mr A. T. Henderson) was seen to take a rubber "paid" stamp from a drawer in the accounts department, said witness.

Other offices in the building were searched for "paid” stamps, but none was found to resemble the one seized, which was sent to the D.S.I.R. in Auckland.