Whitley's lavish life recounted

Richmond businessman Philip Whitley spent the equivalent of $7000 a week on household expenses over a nine-month period he was getting money from investors in his company, NearZero, a court has heard.

Forensic accountant and Serious Fraud Office (SFO) witness Clive Hudson said he forensically examined the 13 bank accounts and credit cards to which Whitley was a signatory. These accounts included Whitley's company accounts and accounts he held jointly with his wife.

Mr Hudson said over the nine months from August 2006 to May 2007, $5.4 million was deposited into those 13 accounts with about $5.24m of that money coming from NearZero investors.

When NearZero was placed in liquidation in May 2007 a total of $589,000 was in the 13 accounts, he said.

He had worked out that Whitley had spent $1.1m on wages, $125,000 on travel, $218,000 on the Richmond City Football Club, $523,000 on cars and vehicles, $852,000 on property and $536,00 on his Syntiro office in the Wakatu Industrial Estate.

A further $683,000 had been sent to his US business associate, intellectual property manager Sherif Safwat, and $270,000 on household expenses.

Mr Hudson said 99 per cent of the money Whitley spent over that nine months came from NearZero investors.

In answer to a question by Judge David McKegg, Mr Hudson said Whitley's spending on his household included $80,000 on furniture and included money spent on loans, rates, groceries, takeaways, videos, petrol and books.

He agreed the $270,000 spent over nine months equated to spending $7000 a week annually on household expenses.

Whitley, 48, has denied two charges of making false statements as an investor.

The SFO says that between August 2006 and May 2007 490 investors put $5.3m into Whitley's US-based company NearZero on the basis Whitley had invented a revolutionary data compression technology.

If the software had existed it would have been worth billions.

Whitley's top personal security guard, Oswald Van Leeuwen, also gave evidence yesterday.

Mr Van Leeuwen, who is an Auckland-based security adviser and has spent time as a military police officer in New Zealand and the Netherlands, said he was introduced to Whitley through a contact he had from his military days.

He told the court Whitley agreed to pay him a salary over $300,000.

Mr Van Leeuwen said Whitley had told him this was a figure he had come up with after speaking with Bill Gates' father, Harold Gates.

He said Whitley eventually employed seven bodyguards.

Whitley said he needed the security as his technology was worth billions of dollars and he had concerns there may have been attempts made to poison him from people he knew.

Mr Van Leeuwen said he asked Whitley where the technology was and Whitley told him it was in a thumb drive he wore around his neck.

Mr Van Leeuwen said he only saw the thumb drive a few times including one day when it was left lying on Whitley's desk.

He said he asked Whitley why he had left it unsecured and Whitley explained he had patented the technology so it was now safe.

Mr Van Leeuwen said another security guard told him he saw Whitley burn documents and other items at his new Redwood Valley house after the Security Commission started investigating his company in 2007.

He said he never told Whitley to burn documents and he advised Whitley to co-operate with authorities.

- © Fairfax NZ News