Politics
New Zealand’s first fraud trial asks why the former president resigned after refusing to sign off his account, citing party practices that violate his moral and business values.
Winston Peters was absent as Foreign Minister at the ASEAN Conference in Thailand when he struck New Zealand First in August 2019.
Party leader Lester Gray refused to sign the annual report, alleging that he was denied information about donations and bank accounts.
Party leader Peters emailed the ultimatum equivalent to Gray. The auditor says the account is fine as long as it is currently signed. “Make sure the document is signed as requested.”
But Gray didn’t shake and didn’t. He sought to require all income to be included in the financial reporting “whether or not it was deposited in the main account”.
The following month, he resigned from his presidency and emailed other board members that he was denied information and support from the top.
“I refuse to approve the 2019 financial report with the information provided. As President, I have had limited exposure to party donations and spending, so I am very It’s vulnerable. This type of operation doesn’t match the values of my moral and business practices, and I just can’t support the party anymore. ”
Details of Gray’s resignation and accusation were revealed in New Zealand’s first fraud trial in Auckland’s High Court on Monday.
As evidence, Gray said he was stranded to find information about the New Zealand First Foundation, which received donations to the party, and the businesses that operate the party’s members and donation database.
He said the money raised by MP Clayton Mitchell at a special funding dinner was not explained. “Not everything is in our bank account.”
The Serious Fraud Office has charged two men for being obtained by fraud. Over $ 750,000 was donated to NZ First, which was transferred to the NZ Foundation’s bank account between 2017 and 2019. As in the case of political parties, this money was not sent to the Election Commission as a political contribution.
The two men whose names have been oppressed denied the charges, saying the crime had not been identified and that the crime had been raised for the New Zealand First Party and spent on New Zealand First Party objectives and projects. Did.
The Foundation was established in February 2017, a few weeks before the party committee voted for a concept review. SFO evidence in court shows that between 2015 and 2017, other donations were diverted to another non-party account for a business owned by one of the defendants. Most donors were unaware that their money would go to treasurer across parties. Key party officials were unaware of the company, or later, who ran the Foundation and it received and used the party’s money.
The trial presents evidence from up to 40 donors, members of numerous key party committees, officials, and SFO investigators.
Gray takes the position of a witness on Monday to see where Mitchell’s $ 250,000 to $ 300,000 donations are on the eve of his then-friend Mitchell’s election to president at the October 2018 party convention. He revealed that he was happy to investigate. “He didn’t know where it was used.”
The morning after the election, Gray was summoned by one of the defendants at 6:40 am, saying “it’s time to leave,” and building a relationship with Winston’s non-office-owning partner Jean Trotman. Advised that it was important. Peters.
The court was shown a document by Trotman directly explaining to Gray how to become an effective president. “It’s important to own the role of president,” she began … “It’s important to have a good relationship with the leader … in that regard, act with a surprising policy. It’s important to be a leader … it’s important that you run the board and always understand their role-money and membership …. the party has excellent finances for the 2020 elections. To ensure that you are in a state … and let’s start acting with this point emphasized. “
Mr Gray said the focus is not on where the money comes from, but on how the party’s and thus the Foundation’s money is being spent.
He relied on a search for Companies Office because he was unable to establish an ownership structure for a company running a party software system called Nation Builder through the Foundation.
He was briefed on the Foundation by a second defendant. The second defendant seemed tired of playing that role, suggesting that Gray might take over from him.The defendant provided him with some bank account information and provided Gray with an account PIN if he wished. [he declined] Mentioned the names of some donors. “I have no clue as to who they are,” Gray told the court on Monday.
Mr Gray said he visited the defendant at home “to find information about Clayton’s money.”
Earlier witnesses whose names were suppressed said Gray sought to find out how the database management company was associated with the party and who controlled the Nation Builder.
At one point, he called Nation Builder directly in California, pretending to represent a NZ nonprofit interested in using the product, and what Nation Builder offers, like the Foundation. I investigated whether it should be used for. The company was using it on behalf of NZ First.
“I pretended to be a non-profit organization to see what the software was,” the witness said. “Nation Builder has made us aware that it is software intended to be used as widely as possible within an organization.” “I was working with two people [the company, which has its name suppressed]..
Regarding his direct approach to Nation Builder, Gray said he and others “want to go through their system as if we were new customers.”
He finally concludes that the Foundation is wasting money on the operation of the Nation Builder system and writes a secret report by hand to Peters’Okland address, saying “I want to avoid email” to Peters and Trotman. I did.
According to the report, the companies that operate the database are too costly and too few to offer, so they need to be self-reliant and a net plus for the party.
At a parliamentary meeting in early December 2018, one of the defendants was excluded due to a “big conflict of interest,” Gray’s approach was approved, but the company “or we’re pulling a pin.” I was given four months to make a positive contribution.
Gray uses “everything I can get” to calculate that the Nation Builder system brought in just $ 3,635 between November 2017 and November 2018, costing $ 219,176. Did.
“Nation Builder brought in very little enough to make itself sustainable.”
And the structure of the company is “it’s like a big anchor pulling the boat down, not stopping it. You have to cut it.”
However, Gray told the court that the agreed company and database were not curtailed and new controls were not taken. As president, he was not given access or information, and one of the defendants and Trotman continued to approve the activities of his staff, the defendant’s family.
By April 2019, Gray was told by former Deputy Leader Fletcher Tabuto to “away” from the company’s activities, and Gray was concerned that MP Mitchell wanted to be able to transfer money inside and outside the party’s account. Was there. “.
“Clayton was a party fundraiser. His job was to bring in, not to spend,” Gray told the Queen’s Counsel, Prosecutor Paul Wicks.
Earlier, key witnesses to the trial, which was granted permanent name repression for human safety concerns, also outlined repeated efforts to reach the bottom of the company’s agreement with the parties.
Judge Pheroze Jagose has issued a repression order “if the court is convinced that disclosure may endanger human safety” under the provisions of the Code of Criminal Procedure. The application for name suppression was supported by both the prosecution and the defense.
Witnesses told the court that it was difficult to obtain information about the company’s and Foundation’s accounts, and that there had been years of agreement between those entities and the party.
An email from witnesses to Tabuto said the lack of a copy of the agreement between New Zealand First and the company was a “big danger signal for me.”
In court, witnesses said, “There seemed to be something very missing in the equation, because it should have been very simple.”
Witnesses sent a separate text to Gray in March 2019, referring to a media article in 2008 involving the Spencer Trust, “finally taken to the Serious Fraud Office.”
“Obviously nothing has been learned,” the text added with the hashtag “#NZFirstFoundation.”
A text submitted to court by Gray to leader Winston Peters states: [one of the defendants] This will give you full access to NationBuilder and staff. “
Witnesses said the defendant repeatedly promised an agreement between his company and the party and that the actions he did not provide (details on the commission rate from donations) are mysterious. Defendant alleged that the fee was not paid because he had not received the donation through the Nation Builder system.
However, “Nation builders have produced marked donations, counted as donations in their own reports,” the Witness told the court.
“By that stage, I was pretty frustrated. I had financial records for other services at the party, but not for this particular arrangement. We’ve been writing this document for over a year. I was looking for it. I was very worried. “
When the defense interrogated, witnesses disagreed with showing “delusions” about the party and Foundation people who believed Gray did not support him. Rather, he showed “a considerable degree of demand.”
In response to Gray’s proposal to “clean Clayton Mitchell,” witnesses claimed that “when I talked to Mr. Gray, I felt something out of control was happening and was trying to investigate.” Said.
The email presented in court was given by New Zealand’s First Secretary-General Liz Witehira to Peters, Christine Campbell Smith, after the Foundation’s existence and its role in processing donations was revealed by news coverage in early 2020. Said to the new President of Tabuto: It creates a serious situation where you need your help to resolve it. “
The party was asking for specific information from [the company handling Nation Builder via the foundation] Things that haven’t been resolved so far.Given the current media … we need to know that all party costs have been [listed] accurately”
Finally, the defendant, on behalf of the Foundation, replied that the investigation proved that the only necessary change was for the Foundation to seek further reimbursement of $ 920 from the party.
When asked by party officials, the defendant replied, “Pay this amount as soon as possible.”
Crown’s proceedings are scheduled to end on Tuesday.