Examples of Corruption in New Zealand

Newsletter Co-editor
Member with Delegated Authority for Open Government Partnership, Parliamentarian Network and SGDs

David Dunsheath

TINZ Member with Delegated Authority for Open Government

Transparency Times Newsletter Co-editor

Corruption exists in New Zealand where there will always be individuals and organisations looking to break or bend the rules for personal advantage. Technology is adding new tools and levels of sophistication for corrupt practices. Corruption prevention, detection and prosecution remain critical for New Zealand. We can’t be complacent with our reputation as one of the least corrupt countries in the world.

What are we talking about?

Corruption is the abuse of entrusted power for private gain. It includes Bribery which is the offering, soliciting, giving or receiving of a financial or other advantage, to influence the actions of a person in charge of a public or organisational duty.

Corruption and bribery, encompass a variety of activities. Examples include:

  • the misuse of funds/resources
  • bribery, forgery, extortion
  • money laundering
  • fraud as a subset of corruption that extends to theft, false accounting or the supply of false information, embezzlement, misappropriation, false representation, tax evasion, and insider trading, theft of intellectual property.

Whereas the majority of corruption can be labelled as fraud, this subset is beyond the scope of this article.

Examples of political corruption

The non-disclosure of political party funding has again surfaced, together with concerns over foreign donations to political parties.

Investigative journalist and author of several books, Nicky Hager, has made various allegations of political corruption and cover-ups. In “Dirty Politics” he identified inappropriate collaborations between government ministers and bloggers claimed to influence the 2011 election outcome.

In 2007, New Zealand Pacific Party MP, Taito Philip Field, was imprisoned on 11 bribery and corruption charges and 15 obstruction of justice charges.

Examples of public sector corruption

In December 2018, the State Services Commissioner’s inquired into state sector spying on the public. This uncovered system-wide failings across the entire public service. These included a pattern of inappropriate closeness with private contractor, Thompson & Clark, and poorly managed relationships with other contractors. The Serious Fraud Office (SFO) is investigating two government employees who undertook secondary employment with this contractor.

In 2018, corruption and bribery was identified within the New Zealand Transport Agency (NZTA). This was associated with issuing new driver licenses. Fake documentation and light-handed testing was involved.

Senior managers, Stephen Borlase (Projenz) and Murray Noone (Auckland Transport) were jailed for procurement corruption and bribery offences totalling $1.2 million. They colluded between 2006-13 with undocumented false invoicing and and undisclosed massive gifting. Projenz achieved a rapid rise in uncontested contracts and resultant vast increase in revenue.

Peter Meng Yam Lim (senior Immigration New Zealand officer) and Ms Kooi Leng Pan (airport worker) were each found guilty of four bribery and corruption charges in 2015. They received S26,000 from two victims to help them obtain visas, even though Lim was not in a position to provide these.

An un-managed conflict of interest situation arose in 2018. A lobbyist consultant was temporarily contracted to the Prime Minister’s Office. She then returned immediately to her private employment without a stand-down period or other safeguards. 

The Office of the Auditor General reported 73 cases of fraud in public entities during 2017/18. complete with the fraud types, methods and reasons for these happening. 

Examples of other corruption

The Panama Papers, the 1MDB trustee case and the Unaoil bribery scandal provide glimpses into the opaque world of offshore money laundering and the clear use of New Zealand as a conduit for corruption. These and other revelations resulted in the Shewin Inquiry with resultant tightening of New Zealand’s trustee laws.  

Sporting at all levels, provide a fertile basis for match-fixing corruption with resultant financial gains by players and corrupt punters. For example:

  • in 2018, New Zealand cricketers were embroiled in such allegations involving 15 international test matches spanning 2009 to 2012.
  • eleven arrests were made in 2018 during an unprecedented police inquiry into harness race-fixing and drug offending as part of 17-month investigation.
  • allegations last year of corrupt player recruitment practices by a secondary school have been defended
  • the risk of corruption in the form of performance-enhancing substances, remains ever-present at all levels of competitive/professional sport.

Deloitte in its 2017 bribery and corruption survey “One step ahead—Obtaining and maintaining the edge Deloitte Bribery and Corruption Survey 2017 Australia and New Zealand.” found that more than 1 in 5 organisations reported recent incidents of corruption in their organisation. [Add Charts – I don’t think we need permission just give them credit]

Conclusion

Corruption exists in New Zealand where there will always be individuals and organisations looking to break or bend the rules for personal advantage.  Technology is adding new tools and levels of sophistication for corrupt practices. Corruption prevention, detection and prosecution remain critical for New Zealand – we can’t be complacent because of this top ranking. 

Source: Deloitte Bribery and Corruption Survey 2017 (Australia and New Zealand) “One step ahead – Obtaining ad maintaining the edge”
Source: Deloitte Bribery and Corruption Survey 2017 (Australia and New Zealand) “One step ahead – Obtaining ad maintaining the edge”

 

 

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