"It was only after seeing the appearance on TV last year about the allegations of him using prostitutes I realised the Craig I had been seeing as an escort is definitely Craig Thomson the politician," Ms Smith told police in her statement, signed in 2012. "I was shocked to see this situation occur but I have since seen him on TV and in the media deny that he used the services of prostitutes. "He is lying and I am in no doubt that the Craig I performed a number of sexual services for over a period of time is Craig Thomson the politician. "The voice of Craig Thomson that I heard fits the image of the Craig I had dealings with." Ms Smith said she provided sexual services to Mr Thomson at various hotels across Sydney in 2007, and that he became a regular client of hers. She said they met a couple of times when she was not working for her agency.

Ms Smith said Mr Thomson on occasions had champagne waiting for her in his room, would pay for extended sessions so they could talk after sex and would escort her out of his hotel when she left his room. She said Mr Thomson had said he was a solicitor from the NSW central coast and that she did not know he worked for the HSU at the time, but had been shown a credit card receipt for $385, from one of their meetings, with his surname and the name Health Services Union. Ms Smith’s statement was released on the same day the prosecution began closing its case against Mr Thomson. Mr Thomson is accused of using HSU credit cards and the Flight Centre account to accrue more than $28,000 in personal expenses, including sexual services, in-house adult films in hotel rooms, and flights and cigarettes for his then wife during his term as national secretary, from 2002 and 2007. He is also accused of withdrawing cash from union accounts for himself. The prosecution alleges he continued using HSU funds on personal expenses even after he left the union to become the Labor member for the NSW seat of Dobell, which he lost in last year’s election while standing as an independent.

Mr Thomson, 49, has pleaded not guilty to more than 140 charges of fraud and theft. Mr Thomson has previously denied claims he misused his HSU credit card by paying for personal expenses and prostitutes, claiming he was being set up by political rivals. His defence team did not call witnesses on Tuesday and will begin its closing submission to magistrate Charlie Rozencwajg on Wednesday, once the prosecution has closed its submission. Ms Smith said she did not have any agenda against him in assisting police. She said she agreed to speak to police ‘‘as I know that the matter will not go away, as my dealings with Craig Thomson were about me receiving payment from him for sex supposedly with not his money’’. In court on Tuesday, lead prosecutor Lesley Taylor, SC, said two weekends in May 2005 highlighted how Mr Thomson used union-issued credit cards to pay for personal expenses.

In the first example, she said that in the early hours of May 7, 2005, Mr Thomson paid $770 for sexual services with an escort worker, Alina, with his HSU-issued credit card while he stayed at Sydney’s Westin Hotel during a work trip. Mr Thomson later prepared a memorandum on HSU paper saying he had spent the money on a ‘‘business expense’’, Ms Taylor said. She said an analysis of the hand-written words ‘‘Internat Immobiliare’’ - the name of a company linked to The Boardroom brothel, which sent Alina - showed a strong resemblance to a sample of Mr Thomson’s handwriting. Telephone call records, credit card statements and frequent flyer statements all linked Mr Thomson to the Westin Hotel that weekend, the court heard. In the other example, Ms Taylor said Mr Thomson used an HSU Flight Centre account to pay for weekend flights from Melbourne to Sydney for his then wife, Christa, later in May 2005 so the couple could use the trip to search for properties on the NSW central coast. The court heard the couple dined at the Westin’s restaurant that weekend and that Mr Thomson put the $374 bill on his hotel room, paid for by the HSU. But he later claimed he had used the $400 cash he withdrew from a union account before the trip for the dinner, ‘‘plus tip’’, the court heard.

Ms Taylor said examples similar to the two cases she highlighted were repeated ‘‘time and time and time again’’ during Mr Thomson’s time as HSU national secretary, and in 2008 when he was the federal member for Dobell. Ms Taylor said the issues of whether Mr Thomson was authorised to use union funds, and his subjective belief, were the keys to the case. She said Mr Thomson was only permitted to use union funds for the advancement of the HSU and its members, and that it ‘‘stretches credulity’’ for him to have believed otherwise. She said he, as a lawyer and experienced union official, would have known the HSU’s policies and practices regarding expenses, and that his conduct in trying to mask transactions showed he knew he was doing the wrong thing. ‘‘It is so self-evidently absurd that a written policy is necessary for intelligent, experienced union officials, particularly like Mr Thomson, to understand that he could not use a union-funded credit card for what he liked, particularly when he masked the transactions,’’ she said.

Ms Taylor said if Mr Thomson was entitled to use HSU funds on himself, he would have not have employed subterfuge. ‘‘He would not have masked transactions and would have said, ‘It’s part of my salary package, I’m allowed to do it’,’’ she said. The court also heard Mr Thomson and his then wife used union money to fund trips interstate and accommodation for events including a wedding anniversary and the 50th birthday of a friend. Ms Taylor said Mr Thomson had previously admitted to incriminating conduct in interviews he have to media, Fair Work Australia and to an investigator from Slater & Gordon, the law firm used by the HSU to look into its finances. Ms Taylor said Mr Thomson had lied about his conduct during some interviews.

One charge against Mr Thomson was dismissed on Tuesday because the alleged offence took place in Sydney, outside the jurisdiction of a Victorian court. Loading The offences Ms Taylor highlighted fell in the jurisdiction because the allegations of theft and obtaining property and financial advantage by deception were against the union, which was based in Victoria. Follow us on Twitter

