The 57-year-old former Heart of the City boss was jailed for five years and seven months in Auckland District Court this morning after pleading guilty to charges laid by the Inland Revenue and Serious Fraud Office covering "sophisticated" offending over more than a decade.
Judge Grant Fraser said the offending involved a "gross breach of trust" and was close to attracting a maximum penalty.
"All your offending involved a high level of premeditation where your actions were planned and deliberate involving . . . a sophisticated web of instruments," he said.
But the judge refused to impose a minimum period of imprisonment because the jail term was enough in itself to hold him accountable.
The ex-mayoral candidate has been on bail since charges were laid last year, but will now swap his plush Ponsonby pad for a jail cell.
The most recent offences, which Swney admitted after a SFO investigation, involved dishonestly using 229 false invoices to obtain $2,527,005 from the organisation between February 2004 and October 2014.
In January this year, he pleaded guilty to four representative charges covering 12 years of offending and $1,757,147 of unpaid taxes.
"His motivation seems to be that he felt he had been underpaid for his contribution to HOTC and had not been sufficiently recognised and should have got more credit for building it into the successful organisation that it is," the SFO prosecutor said.
The court was told that Swney had sold a bach and raised $331,961 - 13% of what he owes.
His lawyer Murray Gibson said there were ongoing discussions in a bid to raise more.
Heart of the City - a city-centre business association registered by Swney in 1994 - has income-tax exemption on the basis that it was created to develop or increase amenities for the Auckland public.
But technically the defendant was a contractor of the organisation as the sole director of AGS Services Limited and the services he provided were taxable.
A summary of facts filed by the IRD showed how Swney issued "various fictitious invoices" to Heart of the City, from which he benefited.
Investigators questioned several organisations - including the New Zealand Herald - over the authenticity of the invoices and determined they were created "without authorisation".
Swney is also on the end of a civil action launched by Heart of the City, whose board announced the move in December last year after forensic accountants scoured their finances.
Swney tried to cheat system - IRD
Outside court, SFO director Julie Read said she was pleased the matter could be dealt promptly with the Inland Revenue case.
"This prosecution demonstrates that this sort of dishonesty will not be tolerated nor will it go unnoticed.
"Business can only prosper in an environment of integrity which is why New Zealand's reputation as a safe place to invest and do business is so important and valuable."
The IRD welcomed the jail term, saying Swney deliberately tried to "cheat the system" to avoid paying tax.
"Swney took every step to hide his actions. But due to the hard work of Inland Revenue's Investigators, he has been caught," Inland Revenue group tax counsel Graham Tubb said outside court.
"New Zealanders can be confident that we will catch people like Swney."
- NZ Herald and NZME News Service
