The director of Queenstown-based IT firm Sonnford Solutions, Kerry Harford, is going on trial on fraud charges.
Harford and associate Michael Swann, the former CIO of the Otago District Health Board, each face three charges of fraud relating to $16.9 million in payments by the DHB to Sonnford Solutions, and Harford, Sonntag and Associates between 2000 and 2006, for insurance, software licences, IT service and support.
It is alleged ninety percent of the payments were then given to another company, Computer South Ltd, linked to Swann and his associates. Media reports last year said Sonnford Solutions kept 10 percent of the payments, allegedly used by Harford for lifestyle expenditure.
The IT services were already covered by agreements with IBM, which provided the health board with IT equipment, an NZPA report stated last year.
In the report, Serious Fraud Office counsel Robin Bates claimed Harford was a close friend of Swann, had not been involved in the IT industry and did not have any particular knowledge or experience in IT.
In the NZPA story Bates claimed Sonnford Solutions never carried out any work or services to justify the DHB payments.
Swann was sacked for gross mismanagement by the Otago DHB in October 2006. Both he and Harford deny the fraud charges.