Labour under SFO investigation

14/07/2020

The Serious Fraud Office has announced it is investigating the Labour Party over donations in 2017:

The Serious Fraud Office has commenced an investigation over donations made to the Labour Party in 2017.

The SFO said in a statement this afternoon that it is presently conducting four investigations in relation to electoral funding matters.

A fifth matter that the agency investigated relating to electoral funding is now before the courts.

“We consider that making the current announcement is consistent with our past practice in this area of electoral investigations and in the public interest,” the SFO”s director Julie Read said.

In the interests of transparency and consistency, the SFO announced the commencement of all these investigations, she said.

However, the SFO said it had no further comment to make on the Labour Party investigation.

The department’s ongoing investigations include one into the New Zealand First Foundation and two other separate investigations into Auckland Council and Christchurch City Council mayoral electoral funding.

The fifth relates to donations paid to the National Party, which has led to criminal charges Independent MP Jami-Lee Ross and three other businessmen.

The SFO has not laid charges against the National Party, its staff or members but that distinction might be lost on anyone not into the minutiae of the case against Ross and the three businessmen.

The Serious Fraud Office says it is on track to make a call before this year’s election on whether to lay charges in relation to the New Zealand First Foundation, which has been bankrolling the New Zealand First Party. . . 

David Farrar says the charges probably result from an art auction:

If I am correct that this is what the is investigating, then it will come down to whether Labour valued the artworks fairly. That determines who get listed as the donor.

Let’s say a painting went for $25,000. Now if the painting is worth $20,000 normally then the artist is deemed to have made a $20,000 donation and the bidder a $5,000 donation as they paid $25,000 for something worth $20,000.

And only donations over $15,000 get the identity published, so the person who paid $25,000 for it, has their identity hidden.

But what if the painting wasn’t really worth $20,000. Let’s say that is a nominal value but in reality it is only worth $7,000. Then the donor has made an effective donation of $18,000 and should have been disclosed. . . 

Having Labour, the NZ First Foundation, two former Labour MPs who are now mayors and donors to the National Party under investigation isn’t ideal. But it’s better than suspected transgressions of Electoral Law and political donations being swept under the carpet.

However, even political tragics might be tempted to say a plague on all their houses and calls are already being made for public funding of political parties.

That is not the answer to the problem of breaking the law.

The answer is good law that people follow with good processes for ensuring they do and strong consequences if they don’t.


Holes in electoral law?

19/11/2019

At last  New Zealand First’s funding is being exposed to sunlight:

Almost half a million dollars in political donations appear to have been hidden inside a secret slush fund controlled by a coterie of Deputy Prime Minister Winston Peters’ trusted advisers.

The secretive New Zealand First Foundation collected donations from wealthy donors and used the money to finance election campaigns, pay for an MP’s legal advice, advertising, fund a $5000 day at the Wellington races and even pay an IRD bill.

A New Zealand First spokesperson said on Monday the foundation had been in existence across several election cycles. “There has never been any suggestion that it is anything other than lawful,” she said.

Records uncovered in a Stuff investigation show a complex web that appears to be designed to hide donations to the NZ First Party via The New Zealand First Foundation. . . 

I was a regional and electorate chair for the National Party and am still a party member.

The necessity of  adherence to electoral law has always been drummed in at every level of the party, especially for fundraising and financial reporting.

No-one with any understanding of what’s involved could believe that a party like New Zealand First could function and run itself and successive election campaigns on lots and lots of small donations and few if any over the threshold for declaring who’s given how much.

Former NZ First treasurer Colin Forster claimed he was moved out of the party after questioning the financial records.

“When Winston wanted to hire a bus for the Northland by-election we were on the bones of our arse,” he said.

“We had about $20 in the bank and I would not let the party take out a loan. We were told not to worry about it and suddenly there was money.

“I could not understand where the money came from.”

Stuff has seen records for the foundation that suggest there have been breaches of the Electoral Act and that the foundation is being used to obscure political donations to the NZ First Party.

Donors to the foundation are primary industry leaders, wealthy investors and multi-millionaires. . .

Every other party in parliament, and most outside it, get donations like this, why would NZ First be any different?

Invoices paid by the foundation seem to show funds were being used for, what appear to be, party expenses.

Among other things, the foundation spent $9364 hiring boxer Joseph Parker to speak at the 2017 NZ First conference, $10,643 on travel reimbursement for MP Clayton Mitchell, $12,000 on legal advice from Russell McVeagh lawyers for Mitchell, and $5000 for a day at Wellington Cup Day races.

It also paid for the party’s Nation Builder website and donations platform, a cost of about $10,000 a month. . . 

Until now it’s been reported that the Foundation only made loans to the party. These payments don’t look like loans.

Efforts have been made by party officials to find out details of the foundation and some say they were removed from the party when they challenged Peters or Henry about finances. There is now a conga line of NZ First Party officials who say they have been forced out of the party. . . 

The party is known as Winston First because it looks like he has total control of it.

But absolute rule works only as long as there is absolute loyalty, or submission.

It looks like there are now enough people who are no longer loyal, or submitting, and they are talking.

The only surprise in this is that it has taken so long for the party’s funding to be questioned like this and that points to holes in electoral law or its administration.


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