2 Feb 2015

Charges in alleged pokie fraud

6:50 pm on 2 February 2015

Four men are facing charges laid by the Serious Fraud Office relating to an alleged gaming machine fraud worth $30 million.

One of the men is a former chairman of Harness Racing NZ, Patrick O'Brien.

The others are his son Mike O'Brien, Nelson hospitality consultant Paul Max and a former gaming inspector who cannot be named.

They were charged as a result of Operation Chestnut - an investigation involving the Serious Fraud Office, the Department of Internal Affairs and police, which began in June 2012. The agencies looked at $30 million in grants made by the New Zealand Community Trust, Infinity Foundation and Bluegrass Trust since 2006.

Between them, the four men face more than 30 charges of obtaining by deception, which is punishable by up to seven years jail.

About 20 venues, including five pubs in Blenheim, five properties in Wellington, two in Hawke's Bay and one in Masterton, were investigated during the inquiry.

The men appeared before a registrar at the Wellington District Court on Monday morning but entered no pleas and will reappear in court next month.

The Department of Internal Affairs said the investigation that led up to this case was a significant operation for its regulatory services branch.

While it could not comment on a case that was before a court, it said the issue was very important and the charge of obtaining by deception was a serious one.

The department said pokie machine gambling provided over $250 million a year to the community and helped fund a wide range of sports activities as well as social, education and health services.

The department added that staff were working hard to use what they had learned during the investigation to lift legal compliance in the gambling sector overall.