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Phillip John Smith appears via audiovisual link at the Court of Appeal in Wellington in 2024 (file image). Photo: RNZ/Lauren Crimp
Notorious killer and prison escaper Phillip John Smith has been investing and trading cryptocurrency while in prison.
Smith, 51, has revealed he used the forbidden cellphones he was caught with last year not only to provide legal advice to others but also for "entertainment purposes".
He elaborated to the Parole Board when pressed that those entertainment purposes included watching YouTube to educate himself on trading and investing in cryptocurrencies.
"I started implementing it with real money on a very small scale just to test it."
Smith was caught in June last year with two phones in his cell, which is an offence under the Corrections Act.
The discovery was a recurring theme in Monday's questioning at his 18th hearing before the Parole Board.
He said he had had the phones for about a year, and while a police investigation took place, it was dealt with internally.
When Smith was asked what he used the phones for, he said to "provide consultancy services and also for personal entertainment".
"I educated myself on how to trade binary options in cryptocurrency, so there was a lot of education around that, and that testing and investment strategy and using demo money.
"And then I started implementing it with real money on a very small scale just to test it, so those sorts of things."
Killer fled the country
The high-profile offender was jailed for life in 1995 for murdering the father of a young boy whom Smith was convicted of sexually abusing.
He made international headlines in 2014 when he fled to South America while on temporary release from prison.
However, his escape was fleeting as a tourist recognised Smith in a hostel in Rio de Janeiro, having seen him on the news, and alerted police.
In recent years, Smith has taken several civil cases against the Department of Corrections and other government bodies.
These included challenges of Corrections' refusal to let him sport a hairpiece in prison, to wear a necklace, to have a specific stereo, or to allow men detained at a special prison unit for child sex offenders to have sex with one another.
In 2023, Smith was back in court on fraud charges relating to offending between 2019 and 2020 while in prison.
He admitted to using a Covid business support loan to commit dishonesty offences, as well as filing false GST and income tax returns.
Smith was sentenced to 24 months' imprisonment to be served concurrently and ordered to pay $53,593.41 in reparations.
A 'new beginning' sought
Despite the fraud and recent prison misconduct, Smith pleaded with the board to be released on parole in February, firmly stating his offending days were behind him and he was seeking "a new beginning".
"I know there are a lot of reasons to decline parole but I just want to emphasise that I have now done 30 years of imprisonment," he said.
"During that time, I haven't committed any violence or sexual offences, including over a significant period of reintegration in the community, where there has been testing.
"If given the opportunity, I can only give you my word that I will succeed, that there will be no breaches of compliance, that I will come back to a progress hearing at a scheduled time and there will only be positive reports about my progress."
Panel convenor Kathryn Snook said the board's focus was not on how long he had been locked up, but whether he posed an undue risk to the community's safety.
However, the pathway to Smith's desired release was not without obstacles, as he has not been able to partake in any external reintegrative activities with his current low-medium security classification.
While his classification was up for review next month, he made it clear he was at the mercy of the Department of Corrections as to whether it would be lowered.
However, it was suggested that if the board granted a release date, irrespective of his classification, he would be able to apply for guided outings in the lead-up.
Snook pointed out that the general pathway for prisoners seeking parole was to finish treatment, lower their classification and progress into reintegration activities so that treatment gains could be tested, and asked why they should adopt a different approach with Smith.
In his response, he spoke about how he had completed significant reintegrative work before he fled to Brazil.
He also stressed that he had proven more recently that he could be trusted, repeating that he had not committed any dishonesty offending in the past five years.
Smith maintained he had broken his offending cycle and credited his supporters for helping him.
"I have a lot of confidence in my ability to make a lawful income for myself. There's a lot of opportunity for me to do that and that is what I am going to do."
Snook said that while he may not have been convicted of dishonesty offending for five years, the cellphones were a serious breach of prison rules.
Smith accepted it was a "mistake" and said there would be no repeat of that moving forward.
But Snook responded that it was not a mistake, rather a "deliberate course of action that [he] took over a period of one year".
She said it was actions such as those that would be considered when determining whether Smith's security classification could be lowered.
Ultimately, the board recognised that the reintegration and testing of Smith would take a long time.
In declining his request for parole, it scheduled another hearing for November 2026 to check on his progress.
* This story originally appeared in the New Zealand Herald.
