Almost half a million dollars in political donations appear to have been hidden inside a secret slush fund controlled by a coterie of Deputy Prime Minister Winston Peters’ trusted advisers.
The secretive New Zealand First Foundation collected donations from wealthy donors and used the money to finance election campaigns, pay for an MP’s legal advice, advertising, fund a $5000 day at the Wellington races and even pay an IRD bill.
A New Zealand First spokesperson said on Monday the foundation had been in existence across several election cycles. “There has never been any suggestion that it is anything other than lawful,” she said.
Records uncovered in a Stuff investigation show a complex web that appears to be designed to hide donations to the NZ First Party via The New Zealand First Foundation.
Former NZ First treasurer Colin Forster claimed he was moved out of the party after questioning the financial records.
“When Winston wanted to hire a bus for the Northland by-election we were on the bones of our arse,” he said. “We had about $20 in the bank and I would not let the party take out a loan. We were told not to worry about it and suddenly there was money.
“I could not understand where the money came from.” Stuff has seen records for the foundation that suggests there have been breaches of the Electoral Act and that the foundation is being used to obscure political donations to the NZ First Party.
Donors to the foundation are primary industry leaders, wealthy investors, and multi-millionaires. One legal commentator, public law expert Graeme Edgeler who also saw the records, believes there would be different consequences under the Electoral Act depending on whether the party and foundation are separate entities or connected.
In either scenario, Edgeler concluded the Electoral Act had likely been broken.
“If the foundation and party are separate, it is likely a corrupt or illegal practice occurred because donations from the foundation were not declared,” he said. “If the foundation is part of NZ First, then the party secretary has likely committed offenses around declaring donations or failing to keep records.
“If some donors were under the impression they were donating to the NZ First political party when making payments to the foundation, then there are possible breaches of the Electoral Act relating to party donations and ensuring proper records.”
In 2017, then NZ First secretary Anne Martin declared that the party received only 13 donations of more than $5000 to $15,000, totalling $135,994, for the 2017 calendar year.
However, documents seen by Stuff suggest the New Zealand First Foundation received at least 26 donations within this range, totalling $325,900 – from only five months of documents.
In 2018, current NZ First party secretary Elizabeth Witihera reported to the Electoral Commission – which regulates the activities of political parties – that the party received five donations in the above range for a total of $65,000. But the foundation records appear to show 11 donations totalling $150,000 across just three months of records.
Witihera has previously said she knew nothing about the New Zealand First Foundation. “I don’t know and I don’t need to know,” she told Radio New Zealand.
Most credits into the foundation account have ‘donation’ in the description. Stuff has also seen receipts provided to donors for payments received. Heading the foundation is Peters’ lawyer and NZ First Judicial Officer, Brian Henry. Another trustee is NZ First’s founding president and political lobbyist, Doug Woolerton. The purpose of the foundation is not clear as its website has been taken down.
An archived website, captured in 2018, says the foundation had the “aim of ensuring there is a secure financial base for the New Zealand First Political Party” with activities funded being to “assist with the party long term”. Some entries are simply labelled as “Deposit” with no names beside them.
Invoices paid by the foundation seem to show funds were being used for, what appear to be, party expenses. Among other things, the foundation spent $9364 hiring boxer Joseph Parker to speak at the 2017 NZ First conference, $10,643 on travel reimbursement for MP Clayton Mitchell, $12,000 on legal advice from Russell McVeagh lawyers for Mitchell, and $5000 for a day at Wellington Cup Day races.
It also paid for the party’s Nation Builder website and donations platform, a cost of about $10,000 a month. Donors to the foundation include food manufacturers, racing interests, forestry owners and wealthy property developers.
Efforts have been made by party officials to find out details of the foundation and some say they were removed from the party when they challenged Peters or Henry about finances. There is now a conga line of NZ First Party officials who say they have been forced out of the party.
It is not the first time Peters has come under scrutiny for undeclared political donations. In 2008, Helen Clark stood him down as a minister while the Serious Fraud Office investigated a $100,000 donation from logistics and transport billionaire Owen Glenn. Peters said, at the time, the $100,000 was given to his lawyer, Henry, to cover legal fees. He said Henry did not tell him about it, and that it did not need to be declared.
Glenn contradicted Peters’ statement, testifying before Parliament’s privileges committee at the time that Peters had solicited the donation and that he knew about it. Peters was later cleared by the Serious Fraud Office and police decided that no offence had been committed.
The privileges committee recommended Peters be censured for “knowingly providing false or misleading information on a return of pecuniary interests.”
Featured Image: Deputy Prime Minister and leader of NZ First Winston Peters. Photo / Stuff