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Fraud trial told of questions directed at law firm

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A Dual claims administrator received a text message from Josie Gonzalez, who was on maternity leave, about two hours after an invoice issue was raised with Jaag Lawyers, the County Court heard today.

Claims administrator Olga Karakotina told the court she contacted Jaag – which was set up by Gonzalez and her husband – on May 16 2013 as a Dual underwriter had questioned a matter from the previous year.

Ms Karakotina emailed Jaag to seek information about the invoice, which didn’t match with insured details in the system.

“Could you please send me details of the invoice and what has been done on the matter to incur the cost in order for us to match this payment accordingly,” she wrote.

She then received an iphone message from Gonzalez, which said she had “just had a call” from a barrister and it looked like there may have been an administrative error on the name of the insured.

Josie Gonzalez and her husband Alvaro Gonzalez have each pleaded not guilty to 14 charges of obtaining a financial advantage by deception.

It is alleged that Dual was defrauded of $17.4 million as a result of more than 400 false invoices for legal services in a period extending a little over two years from March 2011.

Ms Karakotina said she emailed Jaag the next day to say she understood they would be reissuing the invoice to reflect the correct name. At the same time, she advised there was a question over a second invoice and what work had been done. Josie Gonzalez again responded to say there had been a mistake on the name of the insured.

She later received a message from Gonzalez saying she had been advised that a revised emailed invoice should be deleted and the attachment not opened due to virus problems. Ms Karakotina later received a letter in the mail from Jaag Lawyers containing amended invoices and also warning about the potential virus.

Ms Karakotina was also asked to look into another matter where incurred costs had jumped to more than $76,000 on a claim that was previously closed, but was unable to find the relevant documentation.

As a result she conducted some inquiries which culminated in her conducting a company search on Jaag Lawyers through the Australian Securities and Investments Commission.

Concerns about Dual’s legal spend had been raised by capacity provider Arch the previous year.

A series of emails exchanged on “audit action points” was highlighted today as the prosecution continued to present its case against the couple.

Josie Gonzalez advised Ms Karakotina in an email that 67 paid invoices from “counsel” would need to be recoded as “insureds own”, the court heard.

Earlier Dual Australia accountant Sonia Christian, who was responsible for accounts payable from early 2011 to mid 2012, was asked about the process for entering invoices for payment into the system.

Ms Christian said Josie Gonzalez would email her a spreadsheet and attached invoices and that she would put the details into the Figtree claims management system. Invoices were also printed and stamped.

Gonzalez would write that the invoices had been “checked and approved” indicating that everything was fine for payment.

In the case of Jaag Lawyers there was typically a notation saying that in their case the payee entry should say “counsel”, the court heard.

Judge Paul Lacava asked if anyone looking for a reference to Jaag Lawyers would see it in the Figtree system.

“No, you would just see it as counsel,” Ms Christian said.

Under questioning from the defence she agreed that Jaag Lawyers “looked like a law firm”.

The defence disputes allegations that Jaag invoiced Dual for services never authorised or provided.

The trial continues.