MSD filed 17 charges in the Auckland District Court against Timothy Bolot, in relation to 20 wage subsidy applications.
“A total of $220,260.80 was paid to bank accounts nominated in the applications,” MSD said.
As the Herald revealed on Saturday, Bolot appeared in court in May 2023 and on his next appearance date three weeks later, a warrant was issued for his arrest.
“A border alert was put on when the warrant was issued,” said George van Ooyen, MSD group general manager for client service support.
Van Ooyen said MSD would not comment on operational matters relating to active prosecutions, including inquiries made to law enforcement agencies.
“MSD’s approach is to recover wage subsidy funding when it is determined recipients were not entitled to retain it. This can include any reparation ordered by the court.”
The office of the Minister for Social Development, Louise Upston, said as of June 30, MSD had approved civil recovery action against 56 businesses and prosecution action against 130 individuals.
“The 56 civil recovery decisions relate to $8.8 million in debt. The 130 prosecution decisions relate to $9.2m in debt,” a spokesperson for the minister’s office said.
“Our Government takes alleged misappropriation of taxpayer and public money very seriously,” they added.
“The Covid subsidy scheme designed by the previous Labour Government was clearly left open to widespread abuse.”
The total value of approvals was $18.8 billion, according to an MSD evaluation of the Covid-19 wage subsidy in 2023.
Meanwhile, Bolot’s company NZCN 1664163 Ltd, previously Best Telecom NZ Ltd, received a loan of $350,200 on January 21, 2021, from Callaghan Innovation.
The balance, including interest, was now at least $405,197.35, the Ministry of Business, Innovation & Employment (MBIE) has told liquidators KPMG.
That was from a $150m Callaghan Covid short-term research and development loan scheme. Cabinet approved the scheme in May 2020.
Callaghan is being disestablished. MBIE has had responsibility for the short-term loan scheme since November.
Seymour: Wannabe entrepreneur politicians to blame
Act Party leader and Deputy Prime Minister David Seymour, who has been critical of Callaghan Innovation, said the case showed the previous Government had a lax attitude to spending.
“The guy steps foot in New Zealand, he’s going to be arrested at the border. He’s already been driven out of what I assume is his country.
“I don’t think anyone disagrees … that the right thing to do here is go after the money.”
But he added: “Should the Government put resources into pursuing someone in Australia? That’s a call for the people on the front line. I don’t know what other demands they have on their time.”
He said the relevant public servants might have bigger fish to fry.
A border alert was put out when the arrest warrant for Timothy David Bolot was issued, the Ministry of Social Development said. Photo / Alex Burton
The Herald understands New Zealand authorities have recently pursued extradition cases where the amount allegedly taken was less than half the $220,556.80 in the Bolot case.
Seymour said Callaghan Innovation loan defaults were the product of a loose system of handouts.
“All of this could have been avoided if we didn’t have politicians who think they have a right to splash other people’s cash.”
He said it was amazing there were not “even more scams” and added: “The people who should be held accountable are the ones who think Callaghan was a good idea.”
Last month, the Herald discovered that as of June 30, $16.3m of those Callaghan Covid loans had been repaid but 69 loan recipients, who received a total of $23.2m, were in receivership or liquidation.
Recipients of $50.2m were up to date with their payments at the time.
Seymour said Callaghan Innovation was conjured up by “politicians pretending they’re entrepreneurs” and looking for photo opportunities.
One Auckland lawyer said extraditing people was complicated.
“People need to be quite motivated to try and extradite someone. I’ve seen it happen with serious sex offending, murder obviously … but I can see why they might look at this and put it in the too-hard basket.”
However, he also said authorities could be taking steps to extradite Bolot and simply weren’t disclosing that.
MBIE head of innovation and business capability Diana Loughnan on Monday supplied more information about how the company got the $350,200 loan.
“As part of the application process, due diligence included a review of the business using online sources as well as of the listed directors.
“As part of the applications process, applicants were also required to declare any matters relating to the business or its directors that could present a reputational risk to Callaghan Innovation or the Crown.”
Loughnan said the loan was provided to the company, which was New Zealand-registered, had a New Zealand address and met eligibility requirements, including having at least one director resident in New Zealand.
“The scheme did not require applicants to disclose the country of residence of all directors,” she added.
“MBIE understands MSD shared information relating to wage subsidy approvals only.”
Labour’s social development spokeswoman Willow-Jean Prime declined to comment.
“Given this is an active investigation and still before the courts, we won’t be adding comment to this matter.”
John Weekes is a business journalist covering aviation. He also has experience covering courts, consumer affairs, crime, and politics.
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