Fraud-accused says others lied

02:45, Nov 14 2012
Loizos Michaels
LOIZOS MICHAELS: On trial for fraud.

Senior political and business figures lied and the Serious Fraud Office acted in a way no-one can explain, an alleged conman told the Auckland District Court today.

Restaurateur Loizos Michaels, who is facing 31 charges relating to losses of more than $3 million, is accused of creating an elaborate web of deceit that convinced several prominent New Zealanders to invest money in outlandish schemes, including a proposed takeover of the SkyCity casino group.

Several Crown witnesses from New Zealand and Australia, including National Party president Peter Goodfellow, have testified that the smooth talking Greek-Australian said he was related to a wealthy Cypriot family that controlled a major shipping line.

Many also said they were told by Michaels that he had links to the Macau-based Ho family, which runs the international Melco casino empire.

Michaels was highly animated under cross-examination in the dock this afternoon, and continued to vehemently deny lying about his background.

Prosecutor Christine Gordon asked Michaels to explain the "remarkable similarity" between the highly specific testimonies of his estranged wife Caroline Wood and former Christchurch Casino boss Stephen Lyttelton.

"Are you saying Mr Lyttelton ... dreamed up this information?" she asked.

"He's dreamed up a lot of information, including that," Michaels replied.

He also said Goodfellow - a member of the NBR Rich List family valued at $500m - had lied to the court, and claimed to have correspondence from his ex-wife that would answer some of the prosecution's questions.

"Just because a person is worth millions of dollars and covered in stardust in this court doesn't mean that he's honest," Michaels said.

Goodfellow loaned money to Lyttelton - an old friend - to invest in the casino takeover venture and was a founding director of a company set up for that purpose. After meeting Michaels he grew suspicious and hired a private investigator, warning Lyttelton about what he had uncovered.

Michaels said the "common denominator" amongst the similar testimonies was the presence of the Serious Fraud Office, which brought the charges against him.

"The SFO has contact with all those people ... with everybody," he said. "I really believe from the bottom of my heart that the SFO acts in ways that no-one can explain."

Gordon also questioned why the birthdays, names and place of birth that Michaels had listed on various company records were different. Michaels said they were mistakes.

"There seem to be an awful lot of mistakes in these documents that you've been looking at, Mr Michaels," Gordon observed.

The trial continues.