Fun on Ponzi-style $103m rip-off

He partied in luxury waterfront apartments, surrounded himself with models and actresses, was chauffeured in BMW and Mercedes-Benz cars and "drank Dom Perignon find it irresistible was Speight's".

However the lavish lifestyle that businessman Gavin Clifford Bennett funded through a $103 million fraud has come crashing down - he's now behind bars and facing the chance of a lengthy jail sentence.

The 54-year-old made surprise guilty pleas within the Christchurch District Court yesterday to criminal charges associated with a Ponzi-style scheme, similar well-liked to the scams folks billionaire fraudster Bernie Madoff.

The admissions dropped at an end one of many Serious Fraud Office's largest investigations in recent years.

Between April 2005 and March 2011, Bennett - then director of Datasouth Group - created false documents with reference to the lease of IT equipment and fraudulently obtained about $65 million from South Canterbury Finance (SCF).

He also falsified entries in financial statements by an estimated $38 million as a way to retain the continued finance.

The end result was a lack of not less than $23 million for SCF, which went into receivership and triggered a $1.7 billion bailout by the federal government.

SCF preferential shareholders like Albert Makary haven't seen any in their money returned. The Timaru doctor finds the actions of Bennett "hard to swallow".

"You do not expect this to happen in New Zealand, that is one of several least-corrupt countries on the earth. It's distressing to look the agony of these those who have lost their life savings, and what kind of their lives was disrupted."

While others were left to suffer financially, Bennett lived a lifetime of luxury in Sydney.

A former executive of a Datasouth subsidiary told how Bennett was ferried around in chauffeur-driven BMW and Mercedes-Benz services - which cost greater than A$50,000 in corporate car services.

The ex-worker told of "lavish" office parties and being whisked around the Tasman to hit Sydney hot-spots, where Bennett "drank Dom Perignon love it was Speight's" beer.

"Gavin went out of his solution to make us think the business was doing well. There has been no hint of anything illegal occurring backstage. Correctly, it was on the contrary. He lavished lots of expense entertaining employees, throwing parties, flying the management team over to Sydney for birthday parties in his apartment."

Bennett spent $596,131 renting two luxury apartments within the Rocks in Sydney.

He outlayed $207,294 on air travel to destinations including Argentina, Manhattan, Hong Kong, Las Vegas, New Caledonia, Rio de Janeiro, San Francisco, Paris and London.

He also spent $209,869 on clothes and apparel, including purchases at Louis Vuitton, Cartier, Chanel, Giorgio Armani, Barney's and Bloomingdales Long island, Victoria's Secret, Paul Smith, Gucci, Jimmy Choo and Harrod's London.

His former colleague said that at Sydney hotspot Hemmesphere "the waitresses could be waiting hand and foot topping up champagne. It was hilarious".

The alternative "running joke" with Bennett's staff was his love of gorgeous women. He was often spotted in trendy Sydney bars with models and actresses.

"We called them 'Gav's girls'. They might come to company Christmas parties or functions all year long and there will be a unique girl every time," the previous executive said.

"There has been nothing secretive about it from his standpoint. i feel he quite liked the actual fact he could happen with these beautiful, young girls from Australia. It was all component of the fantasy world he had created for himself."

He also hung out with Marlena Davis, a co-director of Datasouth's Australian arm.

Another executive told of an occasion when "Marlena turned up on this skimpy little dress and this new set of boobs. Gavin made connection with her having new boobs."

This news was followed by talk of whether Datasouth "owned" the breasts. "There have been jokes about whether we should always asset-tag them."

Bennett moved to Sydney in around 2006 or 2007, shortly after breaking apart along with his wife of 20 or so years, Jane.

One of many executives spoken to said he was not surprised when the SFO found irregularities throughout the business last year.

"I'd exit with [Bennett] for dinner and after a number of drinks he'd let a number of things out of the bag. When SCF began to hit the headlines, Gavin became very, very nervous. There has been a noticeable shift in his behaviour.

"He admitted struggling to sleep; he was quite open to us about that. We certainly weren't aware that his nervousness was due to the scheme he had occurring."

Over a six-year period, around $7.8 million was paid either to non-public New Zealand and Australian bank accounts controlled by Bennett or applied to business charge cards that he used for private expenses.

Datasouth went into liquidation last March, leaving all 31 staff out of jobs.

The administrative described Bennett's situation as "pretty sad and tragic".

"All of his dishonesty is coming home to roost now."

Bennett was convicted of six representative charges under the Crimes Act regarding 900 separate incidents of dishonestly using a document and two further charges of false accounting.

He'll be sentenced on May 3.

By Kurt Bayer and Jarrod Booker | Email Kurt