A Wellington foodbank spent donations on junk food, booze and electronics while giving only a fraction to the hungry, court documents claim.

The Department of Internal Affairs (DIA) alleges only 4 per cent of the $770,000 donated to the Wellington Foodbank Service ever went to helping the needy.

The foodbank - not associated with the one run by the Wellington City Mission - claimed to help "low-income families, children and youth of the Wellington region".

Instead, the department says, it misled donors and risked damaging the whole foodbank sector.

Most of the money donated was missing or had been paid to the foodbank's fundraiser, Wellingtonian Michael Hawkins, the department says. Charity donations were also used to buy fast food, alcohol and film tickets.

When the charity was placed into liquidation this month, its bank account was overdrawn and it owed $23,000 in rent.

Hawkins was personally declared bankrupt in May, owing $400,000 due to "gambling, speculation and extravagance in living", according to a DIA investigator who filed an affidavit in support of the liquidation proceedings brought by the Registrar of Incorporated Societies.

On paper, Hawkins was contracted only to fundraise, but the department believes he was the founder, controller and main beneficiary of the charity.

The affidavit claims:

The documents show he drew a $390,000 "commission" for his fundraising over 3 years and used the charity's bankcard to pay "business expenses".

Since the charity was founded in April, 2010, more than $400,000 was withdrawn in cash through 980 ATM transactions.

Hawkins personally made 23 withdrawals in a month, including one of $800 which he handed to his girlfriend.

Nobody from the charity was in court for the liquidation hearing, and no defence was filed.

The documents also reveal that Hawkins was previously contracted as a fundraiser for Wellington City Mission.

Mission chief executive Michelle Branney said yesterday that his contract was terminated after public complaints about "pushy" tactics in 2009.

She suspected Hawkins developed his own "foodbank" after seeing how generously people gave to a genuine charity. "But I just don't understand how someone could spend that much money."

Hawkins yesterday denied most of the claims, and accused other charities of trying to bring the Foodbank Service down. "All of a sudden they were getting competition for those same sponsors, and that's why they attacked us."

He denied running the foodbanks, saying he was contracted only to fundraise, on the same cut he had received from the City Mission. "I was only getting paid for what I was entitled to, and what was signed in the contract. If that seems like a lot of money to you, that's your opinion."

Many of the department's allegations were not true, including claims that he gambled, he said. The foodbank had helped many people but had not kept good records. "I don't know what the exact figure is [spent on the needy], but it's a lot more than 4 per cent."

He expected the matter would go to court, where he would prove his innocence.

The Dominion Post could not reach the company's sole remaining registered officer, chairwoman Marcelle Philpott, for comment yesterday. The department claims Hawkins was solely responsible for running the company, which he denied.

Philpott's mother said her daughter had done nothing wrong.

In a statement yesterday, the department said its investigation into the foodbank had uncovered some "significant concerns", which were now being discussed with the charity. The department would refer the matter to other government agencies "if appropriate".