Software assessor didn't use own gear

A computer expert who tested a Richmond businessman's revolutionary data compression technology and prepared a report that was later given to potential investors says if he was to assess the software again, he would do it differently.

In 2001, Wellington man Titus Kahu was sent by his employer, Logical Networks, to Nelson to carry out tests on Philip James Whitley's new technology on behalf of his company, Astute Software.

Despite bringing much of his own computer equipment, it was insisted that Mr Kahu use computers provided by Astute, he told the Nelson District Court during Whitley's fraud trial yesterday.

He came prepared with his own testing scripts, and was required to investigate how much the program could compress computer files, and the speed at which it occurred.

He said he found the results "astonishing", especially considering the program could compress and decompress "on the fly" without prompting from the user.

Mr Kahu said he did not have concerns about the files chosen to be compressed as they were standard "Canterbury Corpus" test files, and there was nothing to indicate more or less data than expected had been transferred.

He was not expected to investigate how the technology actually worked, only that it could transfer the data.

Mr Kahu said he was not aware of data compression scams, or of an investigation by Canterbury University associate professor Tim Bell, who concluded Whitley did not have the technology he was claiming.

Whitley has denied two charges laid by the Serious Fraud Office (SFO) of making false statements to get people to invest in his United States-based company NearZero.

The SFO says that 490 people invested $5.3 million in NearZero between August 2006 and May 2007 on the basis that Whitley claimed to have invented revolutionary data compression technology and he had patent protection for it.

After being contacted by Whitley in 2006, Mr Kahu validated his report and said he was happy for potential investors who read his report to contact him about it.

In an affidavit he made after the Securities Commission started investigating Whitley's companies NearZero and Syntiro, Mr Kahu said he would be happy to do tests to show the product was not a scam and it could compress data as claimed.

However, when asked by SFO prosecutor John Upton, QC, Mr Kahu said if he did the test again he would put various safeguards in place to ensure the integrity of the machinery.

He would insist on using his own equipment and conduct the test on premises not run by Whitley.

In 2006 Mr Kahu left a job with Telstra Clear to become engineering director for Syntiro.

His job was to set up infrastructure and be a liaison between potential customers and the product.

His salary was $250,000 a year.

When working for Syntiro, Mr Kahu said he never saw the technology or it working.

Under cross-examination by defence lawyer Tony Bamford, Mr Kahu said he never met or spoke to Whitley until 2006.

When testing in 2001, he said there was no pattern consistent with hidden files being in the data.

When interim liquidators were appointed, he said he was not surprised the technology had not been brought into the company as it was not yet completed.

- © Fairfax NZ News