A jury was told that Peter Alp was questioned by two Leeds City Council auditors after concerns were raised about ‘suspicious’ payments made to two creditors, Dean Oates and Bittern Entertainment.
No evidence could be found that either of the two, who received a total of £178,340 from Leeds Grand Theatre over two years, were genuine organisations providing services to the theatre.
Alp is accused of fraudulently entering the 54 invoices for services that were not actually carried out on behalf of Oates, who was his ‘passing acquaintance’, and Bittern. He denies an offence of conspiracy to commit fraud.
A trial jury heard that each invoice would result in hundreds, and later thousands of pounds, in public money being paid into either Oates’s bank account or one he set up in the name of Bittern.
The 54-year-old would then allegedly go to a Harrogate pub to meet Oates, who had fallen on hard times after being injured in a car accident and was unable to work, in order to pick up half the money.
Sonya McDonald, currently the acting head of audit at Leeds City Council, was working in the authority’s internal audit section in June 2013, when concerns were first raised.
In her evidence at Leeds Crown Court, she said none of the 54 invoices relating to Oates and Bittern, most of which were entered by Alp, had accompanying purchase orders to check what goods or services had been paid for.
The jury heard Miss McDonald and a colleague asked for a meeting with Alp, who had set both Oates and Bittern up as creditors on the council’s system.
Alp was asked if he knew anything about either organisation or the goods and services they provided, and said he didn’t.
When asked about the purchase order accompanying a Bittern invoice, he said it “may be to do with entertaining the stars of a show” when a visiting company comes to the theatre, the court heard.
Miss McDonald said: “He gave an example of when Jason Donovan came to do a show and the costs related to keeping Jason Donovan entertained in Leeds.”
Miss McDonald added: “He said it was common practice for orders not to be raised at the theatre and it was something he had raised with management.”
The two auditors then spoke to Ian Sime, the theatre’s general manager, who couldn’t find anything in his files about Bittern Entertainment.
All three then accompanied Alp to City Varieties Music Hall to find evidence of any services Bittern had provided, but no documents were found, the jury was told. Mr Sime tried phoning the number on the invoice but it was dead.
Some of the invoices had details of shows put on by theatre, such as Top Hat or We Will Rock You, but Miss McDonald, but could find no evidence that Bittern had provided services relating to the shows.
She said that when Mr Sime was shown some of the invoices that appeared to show his signature on them, “he told me he couldn’t believe he had signed them”.
The jury was told that Miss McDonald then returned to her office to discuss the case with the head of audit, because “no-one was able to give us confirmation that these were legitimate payments.”
After a later meeting with Alp and other senior council officials, the head of finance was suspended, while an investigation was carried out into the suspected fraud.
Oates, from Lime Bar Lane, York, has already pleaded guilty to conspiracy to commit fraud, while Alp, originally from Harrogate and now of Minster Drive, Herne Bay, Kent, denies the same offence.
The trial continues.