Peter Scutts played 'double game', Crown alleges

Crown alleges Scutts used son to disguise what invoices were for | Scutts has pleaded not guilty to 17 SFO charges.   Victoria Young discusses the latest in the Peter Scutts case on NBR Radio and on-demand on MyNBR Radio.

Former wine boss and ad man Peter Scutts has been accused of playing a “double game’’ as the Serious Fraud Office case against him opens this morning.

This morning in the High Court at Auckland before Justice Mary Peters, Mr Scutts pleaded not guilty to 17 charges brought by the government department in charge of fraud prosecutions. 

The charges include one for a receiving a secret reward under the Secret Commissions Act, while further charges relate to the dishonest use of a document under the Crimes Act. The SFO alleges while working for the New Zealand Wine Company (NZWC) Mr Scutts received payments from Australian wholesaler Liquor Marketing Group (LMG) based on the volume of wine sold.

He had allegedly received $1 per case of wine sold when NZWC supplied 60,000 cases of wine to LMG. 

Mr Scutts used a company jointly owned with his son Oliver, Rochfort Rees Wine Company, to invoice NZWC and LMG but some payments, the Crown alleges, went to Mr Scutts’ Australian bank account.

Crown prosecutor Rachael Reed says Mr Scutts was paid by NZWC more than $1000 per day plus business expenses for wining and dining, which included pursuing senior managers of LMG.

She told the court Mr Scutts was “playing a double game, and taking a secret commission from one party for doing so.’’

She says Mr Scutts prepared invoices in a particular way so they were not discovered by NZWC, and even if they were discovered they were prepared in a way which looked like they were prepared by Mr Scutts' son.

‘''They were dishonestly used to disguise the nature and type of services provided,’’ she said.

Good transaction
Mr Scutts' lawyer John Billington QC says an agreement in place between Rochford Rees and LMG is unrelated to the NZWC transaction. He says Mr Scutts never ''advised'' LMG to enter the contract, and did not agree to a secret commission. 

Mr Billington says the Rochford Rees entity was a tightly held family company and Mr Scutts' was entitled to deal with it how he wanted. 

The Queen's Counsel told the court that Douglas Finlay, the general manager of LMG at the time, will give evidence in support of Mr Scutts. Mr Finlay had been interviewed by the SFO which chose not to call him as witness. 

Mr Billington says Mr Finlay is the only party within LMG who has direct knowledge of the transactions entered into. 

The lawyer for Mr Scutts says the transaction has to be seen in the context that it was a significant transaction when NZWC was facing insolvency, and there was a wine glut in the Australasian market, 

Mr Scutts is well known in the advertising industry for his time managing Young & Rubicam (Y&R), and in the rugby world as former chief executive of the Auckland Blues franchise.

He was the chief executive of the New Zealand Wine Company from July 2011, until the company merged with Foley Family Wines [NZAX: FFW] in September 2012. Foley Family Wines made a complaint to the SFO in 2013.

The trial is expected to take one to two weeks.