Week in Review

SFO charges over donations add to election year drama

Simon Bridges is claiming vindication after avoiding charges from the Serious Fraud Office relating to donation claims, but that there are charges at all will be the bigger concern, as Sam Sachdeva writes

There is no good time for a political party to be told donations made to it have resulted in criminal charges - but as far as bad timing goes, an election year is right up there.

The news that the Serious Fraud Office (SFO) has filed charges against four people in relation to National Party donations is in some ways a surprise, and a particularly nasty one for leader Simon Bridges.

Rogue MP Jami-Lee Ross’ claim in late 2018 that a $100,000 donation from Chinese businessman Zhang Yikun had been artificially divided to avoid disclosure requirements was certainly incendiary, but came with little in the way of incontrovertible proof.

The SFO has a reputation for being careful with the cases it takes on, while allegations of electoral offences have rarely led to prosecutions throughout New Zealand’s political history.

That suggests investigators have gathered enough evidence to be confident of success, although nothing can be taken for granted and those accused are entitled to the presumption of innocence.

Bridges himself is in the clear legally, having stated neither he nor party secretary Greg Hamilton are among those facing charges.

But his claims of vindication, while strictly accurate, miss the wider import of the SFO’s announcement.

Speaking to Newsroom before the charges were revealed, University of Otago law professor Andrew Geddis had said it was the donors, rather than the party, likely to be under the spotlight.

As Geddis subsequently pointed out, it’s unsurprising that Hamilton hasn’t been charged, given the Electoral Act allows a party secretary to “take on face value” any information provided to them by a donor.

“If Greg Hamilton was given a list of names as having each given an amount under $15,000, and is able to confirm those people existed, then all he had to do was bank the money, keep a record of them as having donated, and include them in the total number of donations of that size reported to the Electoral Commission.”

Former National MP and current independent Jami-Lee Ross levelled the electoral allegations that have led to charges by the SFO. Photo: Lynn Grieveson.

That still leaves the party liable to allegations of naivety, or gobbling up cash without thinking carefully enough about its source - not criminal offences, of course, but ones that may not sit well with the wider public at a time when the integrity of New Zealand’s donations regime and the country’s susceptibility to foreign influence are under the microscope (Zhang, who was not accused by Ross of anything illegal or unethical, is known to have close ties to the Chinese government).

Then there is the small matter of whoever is actually charged and the evidence that will be presented against them in court, which almost certainly will not be good news for National.

The accused are scheduled to appear in Auckland District Court on February 25, and their case would seem unlikely to reach a swift resolution even with a guilty plea.

The SFO is no stranger to political campaigns, having been forced into the spotlight in the lead-up to several recent elections.

In 2008, the office joined the Electoral Commission and police in investigating claims about donations made to New Zealand First by wealthy businessman including Sir Owen Glenn and the Vela family.

Shortly before the election, SFO director Grant Liddell said there was no basis for laying fraud charges, but suggested outstanding questions about other potential electoral breaches could be investigated by the police and Electoral Commission (neither of whom ultimately took any action).

The office itself, rather than its investigations, has also become the subject of headlines.

In 2014, Judith Collins resigned from Cabinet over allegations she had tried, through controversial right-wing blogger Cameron Slater, to undermine the then SFO director Adam Feeley.

Collins later returned to Cabinet and was given her old police and Corrections portfolios after an inquiry found no evidence to suggest she was part of the efforts to smear Feeley, and that the implication she was involved was "untenable".

The office seems certain to again have some level of influence on this year’s election campaign - and more may be yet to come.

Allegations levelled against New Zealand First over its eponymous foundation and supposed breaches of electoral law are yet to be resolved - the Electoral Commission says it is still in discussions with the party, while the SFO did not return a request for comment about whether or not it was investigating - but will need to be dismissed or advanced soon given the significant public interest for voters.

Justice Minister Andrew Little has acknowledged our electoral laws are in need of a long-term overhaul, but it is our current laws that will be the subject of much attention in the coming months.

Get it early – This article was first published on Newsroom Pro and/or included in Bernard Hickey’s ‘8 Things’ morning email of the latest in-depth business and political analysis. Get it early by subscribing now or starting a 28-day free trial.

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