7 Jun 2022

NZ First donations case: Defendants kept $700,000 to spend 'as they saw fit', Crown says

7:03 pm on 7 June 2022

The Crown has opened its case against two people charged in the New Zealand First Foundation fraud case.

The High Court at Auckland

The Auckland High Court Photo: RNZ / Simon Rogers

They are accused of using a "fraudulent device, trick or stratagem" to secure more than $700,000 between September 2015 and February 2020, later used to pay expenses for the New Zealand First party.

The pair, who can't be named, have pleaded not guilty to one charge each of obtaining by deception, laid by the Serious Fraud Office (SFO) in September 2020.

Media have fought to name the accused since they were charged but their identities remain suppressed by the High Court.

At the time the SFO laid charges in September 2020, neither of the accused was a minister, sitting MP, a candidate in the 2020 election or a member of their staff, or a current member of the NZ First political party.

Opening the Crown's case this morning, Paul Wicks QC said 40 people had given money, either deposited to the foundation or one of the defendant's private companies, believing the funds were going to New Zealand First.

It is the Crown's case these were political donations, some of which should have been reported, but Wicks said the defendants kept and managed the money with "unfettered control" of it.

"They did not transmit that money to the party secretary. They kept it and then spent it as they saw fit.

"Thus, the Crown says, as a result of a stratagem, the defendants both obtained and retained control over the funds."

Wicks said some of the money was used to pay rent for a Lambton Quay office space with the signage 'New Zealand First Party Headquarters', while nearly $10,000 was spent hiring boxer Joseph Parker to speak at a party conference.

The money also paid for campaign expenses, including handbooks, flyers, advertisements, business cards and a $25,000 video of New Zealand First leader Winston Peters touring the country, he said.

It is the Crown's case the board and the party's president were kept in the dark and "seriously misled" over the funds.

Paul Wicks QC argued there was no way the defendants did not know better.

"It is, with respect, virtually impossible to countenance that the defendants could possibly have conceived that they could obtain three quarters of a million dollars in funds from party donors and that by the mere expedient of directing those funds to a non-party account that that somehow converted them into being something other than party donations."

Wicks said as well as misleading the board, those who gave money were also misled.

"Few of the donors appreciated that there was any difference between the foundation and the party. Those that did, nevertheless, assumed it was an arm of the party."

No one was deceived - defence

Both defendants deny the allegations.

In opening remarks today, one of their lawyers Tudor Clee said the Serious Fraud Office had no evidence of any crime.

"There was never an instruction from the party to deal with the funds that was not followed. Crime is not about speculation of what if. Crime is only about what actually happened."

Clee said no one was deceived, including the New Zealand First Party.

"Significantly, the party leader is not on the witness list. Disclosure shows he has not been interviewed about the property crime before the court.

"Their theories of a property crime called electoral fraud as they persist to prosecute simply does not exist in law."

Clee argued the evidence showed that the money that went to the New Zealand First Foundation was used as the party expected.

The judge-alone trial before Justice Jagose is set down for six weeks.