Timothy Schwab, 28, drove a sports car and lived in an $870k house while defrauding the NT taxpayer

THE first man to be locked up for defrauding the CLP-era Indigenous Employment Provisional Sum was using the taxpayer as a bank, in effect, so he could afford his expensive lifestyle’, the Supreme Court has heard

Timothy Schwab defrauded the Northern Territory taxpayer of $213,000

THE first man to be locked up for defrauding the CLP-era Indigenous Employment Provisional Sum was “using the taxpayer as a bank, in effect, so he could afford his expensive lifestyle,” the Supreme Court has heard.

Justice Graham Hiley made the comments during sentencing proceedings for Timothy Schwab, the 28-year-old manager of suburban building firm Timber and Steel Constructions.

Schwab last week pleaded guilty to obtaining benefit by deception, a charge which involved 56 acts of deception and which saw him rort $213,000 in ill-gotten money from the taxpayer.

The court heard on Monday that Schwab owned an $870,000 house in Nightcliff, drove a Ford Mustang and had repaid just $33,000 to the taxpayer.

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Crown Prosecutor David Morters said Justice Hiley would conclude Scwab’s lifestyle was bankrolled “to an extent, from the money which he has stolen from the Northern Territory community”.

“The system reposed a certain amount of trust in the way he and other builders would make claims, and certainly he has breached that trust by exploiting the system,” Mr Morters said.

Mr Morters said Schwab was only truly sorry for the predicament he was now in.

“It is often the case that people are remorseful when they are facing the harsh reality of imprisonment,” he said.

Schwab’s lawyer, Matt Hubber, said his client was not “a man of particularly worldly experience” and had made changes to his business so the fraud could not continue once he returned to work.

He said Schwab’s Mustang was heavily mortgaged and his house had also been used as collateral in a loan for a workshop at Berrimah.

He said selling Schwab’s asset’s would see the business go under and would in turn prevent him from repaying the taxpayer.

Justice Hiley flagged concerns about the management of the scheme Schwab rorted, which continued to make payments to him based on false invoices even after bureaucrats had red-flagged him for fraud.

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“It is a bit hard to understand why they kept paying him,” he said.

Mr Morters said frauds committed against companies or governments with “weak systems” were still serious.

Schwab, who has been remanded in custody since last week, will be sentenced on Wednesday morning.