The two Wellington accountants who were last year handed the longest jail terms in a New Zealand tax case are appealing their convictions, claiming Inland Revenue trained their clients in evidence against them.
David Ingram Rowley and Barrie James Skinner were last year jailed for eight and eight-and-a-half years respectively, after Justice Kos found them guilty on dozens of charges of fraud, tax evasion and attempting to pervert the course of justice.
During sentencing Justice Kos also said the pair, previously directors of Tax Planning Services (TPS), had also committed perjury during the eight-week trial in the High Court in Wellington.
Rowley and Skinner were accused of defrauding the IRD out of millions of dollars when they used sham transactions, usually for non-existent "services", to reduce the tax bills of some of their clients.
However, the Crown said the majority of the benefit flowed back to Skinner, and to a lesser extent Rowley.
Handwritten notices of appeal from the pair, who are now serving their sentences in Rimutaka Prison, claim evidence against them in the trial was unreliable, and that the sentences were disproportionate.
Rowley's notice of appeal says Justice Kos placed great weight on statements given by TPS' clients to the IRD, which he said were made under threat of full audit and penalties.
Coming when the accused had little influence over, or contact with, their clients, the evidence should not have been given the weight it was in the judgment.
"Evidence given in court relating to the pressure the IRD was asserting was ignored by the trial judge."
Clients involved in the case included lawyers and company directors, many of whom said that they had no idea what the transactions were for, but simply acted on advice from Skinner and Rowley.
During the trial, details emerged of a payment to Lorraine Skiffington from property developers seeking to develop land owned by the Wellington Tenths Trust, where her partner, Sir Ngatata Love, was then chairman.
Transactions involving the Tenths Trust are now the subject of an ongoing Serious Fraud Office investigation.
Skinner, a former IRD investigator who was accused of spending more on international travel and accommodation over six years than his declared income, claimed the sentence he was given was "out of all proportions regarding the charges".
He said the IRD had made money out of the case, with client tax deductions reversed, and income assessed against him and Rowley.
Skinner said he had had in excess of $4.2 million in net assets in early 2005. Since the trial he had lost everything and has been declared bankrupt.
"No consideration has been given to my wife who is now homeless," his notice of appeal said.
The Court of Appeal is yet to set a date for a possible hearing.