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Playboy’s Paradise – a New Brand for New Zealand?
NZ was enjoying the fruits of Dotcom’s labour
The Auckland arrest of billionaire Kim Dotcom, an investor and online piracy facilitator file-sharing host, in his mansion made worldwide news headlines – and cost Kiwi taxpayers at least $70,000. Along with American agents, the New Zealand police had been conducting an investigation into Dotcom’s website Megaupload since August of last year. He and six others were part of a group called the “Mega Conspiracy”, charged with reproducing and illegally distributing “free” copies of proprietary works such as software, films, TV programmes, music and books.
Dotcom was granted New Zealand residency in November 2010, under a scheme whereby he had to invest $10 million in government bonds and pass a test of good character. Despite strict regulations about the sorts of foreigners permitted to take up residency in the Pacific nation – thin people, people with low blood pressure, and the non-handicapped – Mr Dotcom, thought to be an obese diabetic with a slipped disc and hypertension, was welcomed with open arms. The health requirements link under the NZIS investor category information page is a 404. His past criminal convictions, sufficient to refuse him ownership of Kiwi land, were nonetheless glossed over when granting him residency. In 1998 he had been sentenced to two years for handling stolen goods and credit card fraud. In 2001, he was charged with illegal speculations on the stock market and fraudulent misuse of funds. The following year, he was arrested in Thailand and sentenced in Germany for fraudulent misuse of funds. Presumably, there is a statute of limitations for the purposes of evaluation of fitness for residency? Yes, dating from 1950, and it was repealed in January 2011.
Kim’s lifestyle, in a country where according to Darrin Hodgetts, poverty is the biggest growth industry, was conspicuous and even frightening, but no one could accuse him of not spreading the money around: large dollops were tossed merrily to politicians and the New Zealand Government. But it wasn’t actually the New Zealand Lifestyle he was after. Internet security expert Jeffrey Carr has suggested that “New Zealand is under the radar, away from Interpol and a better lifestyle than Eastern Europe.”
Now a father of five, Dotcom was charged this time with five counts of copyright infringement and money laundering, along with other employees of his company and its subsidiaries: Megaporn, Megavideo, Megaclick, and Megarotic. When the police showed up for the bust, at his birthday party no less, he barricaded himself inside his mansion’s safe room with a sawed-off shotgun, which he had purchased for his family’s safety.
His English was undoubtedly good enough to pass; however, investor-category candidates only need an IELTS score of 4 out of 9 to gain residency. It is clear that some immigrants are more equal than others, in a nation that trumpets its lack of corruption as a point of attraction. Russian mining billionaire Abramov, incidentally also a citizen of Cyprus, and roughly a dozen others have become new residents under this category. Kim Dotcom is now out on bail, his order of arrest nullified and voided.
It turns out that John Banks, Auckland Mayor, is alleged to have given the German scofflaw unlicensed immigration advice. But that was not the least of it. Current allegations under investigation suggest that Banks’ mayoral campaign received “donations” in two hefty $25,000 chunks from Dotcom that, along with gambling den Sky City’s, were listed as anonymous. Although Banks has distanced himself from the issue, claiming faulty memory, it is clear there was schmoozing going on. Banks had attended parties at the Dotcom mansion, proposing toasts, and enjoyed personal helicopter taxi services. ACT party leader Banks is small business and regulatory reform minister and an associate minister for the commerce and education portfolios.
What is unclear is where Kim received the inspiration for Welcome To The Good Life, on his first album Bailhouse Rock. The lyrics – “Sleep all day, party all night / have whatever you want, whenever you like” –suggest an esprit that Joe Blogs could never afford to embrace, even if he did like.
ACC Calls In Serious Fraud Office
First it was the allegations of bribery and the ‘homes for sex’ scandal at Housing New Zealand, now it’s the behaviour of staff at the Accident Compensation Corporation (ACC) that’s causing concern.
“The Accident Compensation Corporation (ACC) says it has referred “matters of concern” to the Serious Fraud Office (SFO).
“While investigating a staff member’s failure to follow internal policies and procedures other matters of concern were uncovered. Owing to the nature, potential scale and duration of those matters we believed it was appropriate to refer them to the SFO”, said Dr Jan White, ACC Chief Executive.
“We have passed information to the SFO and will now await their consideration of whether a formal investigation is warranted.”
ACC says the worker has been dismissed for failing to follow policies and procedures.
Its board has told the Minister for ACC of the issue, as well as the State Services Commission, Department of Prime Minister and Cabinet, Department of Labour and Auditor General.
“Given that this situation is being considered by the SFO, ACC will not be making any further public comment at this stage,” Dr White said.”
Believe it or not New Zealand was recently placed top by Transparency International for being the country with the ‘least amount of corruption’.
Their data was based on the results of 13 independent surveys and has been used for a number of years to promote New Zealand as being a good place in which to do business.
Contrast that with PriceWaterhouseCoopers’ Global Economic Crime Survey that showed that NZ has higher rates of economic crime than its closest neighbours and is way above the world average and that corruption survey starts to look decidedly shaky.
The Global Economic Crime Survey, carried out annually by one of the world’s largest accountancy professional services firms PriceWaterhouseCoopers, showed that a massive 42% of organisations in NZ had suffered from fraud in the last 12 months (against a global average of 30%) and 46% of it was committed by middle and senior management. The average fraud is costing around $500,000 in each business.
PWC is a Big Four auditor, alongside KPMG, Ernst &Young and Deloitte Touche Tohmatsu, so their report must carry some credence. This is the largest international survey of its kind with over 3,000 organisations taking part across 54 countries. 85 organisations from across the public and private sectors took part in the survey: From the PWC website:
- Financial statement fraud was cited by 36%. Since (the) last survey in 2007 we have noticed a significant trend in the perpetrators of fraud towards middle and senior management. When we align that trend to the fact that New Zealand organisations say that staff reductions have resulted in fewer resources deployed on internal controls and that internal audit were being asked to do more work with less staff, we believe that there is cause for concern. It is people in middle and senior management that are more able to override controls within an organisation.”
- Intellectual property theft was at 17%.
- In 72% of all cases the fraud was committed by someone inside the organisation.
“(The) survey shows that economic crime continues to be a serious issue affecting New Zealand organisations with the current economic crisis increasing the pressures and incentives to commit fraud. New Zealand had the eighth highest reported level of fraud across the 54 countries that took part, with 42% of our respondents saying that they suffered from some form of economic crime in the last 12 months. The average cost of fraud in New Zealand was $491,506 with one organisation reporting that economic crime cost them in excess of $7 million in the last 12 months.”
If the outcome of the ACC’s investigation are ever made public we’ll be sure to mention it.
A Work and Income employee faces two years’ jail after using false identities and inventing a child to defraud more than $36,000. Letitia Lilly Anne Proctor, 23, pleaded guilty in Palmerston North District Court yesterday to four charges of fraud and one of computer crime carried out between August 27, 2008, and May 27 this year.
She had worked for the Social Development Ministry since April 2006 and was a case manager at the Work and Income Palmerston North branch from July last year…In total, Proctor defrauded the Social Development Ministry of $27,529 but the ministry was unable to claim back the $10,433 she received through computer fraud.”
Allegations Of Bribery At Housing New Zealand? Updated – Sex Scandal
(Scroll to bottom of page for update)
Back in November we talked about how New Zealand had a higher rate of economic crime than its near neighbours, way above the world average: a massive 42% of businesses in New Zealand had suffered economic fraud in the previous 12 months against a global average of 30%.
Now it’s emerging that the country may have problems with bribery within one of its government institutions. Readers will already know of (Ex) MP Phillip Field found guilty of bribery and corruption. The former immigration boss Mary Anne Field who “consistently breached” the requirements of public servants to manage conflicts of interest. They may also remember Former list MP Donna Awatere Huata who was convicted of fraud.
Voxy first hosted a HNZ press release yesterday that carefully avoided the “B” word:
“Housing New Zealand is investigating an allegation a staff member has been offering applicants for state houses preferential treatment, in return for money, Chief Executive Dr Lesley McTurk said today.
“I can reassure everyone this situation is being thoroughly investigated. Immediate employment action has been taken,” Dr McTurk said. “Once our investigation is complete, it will be possible to make a decision whether it is appropriate to bring the matter to the attention of the Police…..”
Today the Herald is running a story saying that it may not be just a single employee that’s involved and, in an article that mentioned the dreaded “B” word five times, said:
“Allegations that a Housing New Zealand (HNZ) staff member has been taking bribes is not the first claim of its kind, says a tenant advocate. Piripi Gray said he welcomed the investigation and had previously heard of other allegations of bribery at HNZ.
He said tenants were vulnerable and felt intimidated by HNZ staff.
“But if they come forward than people can really see what is happening inside Housing New Zealand,” Mr Gray said. He said tenants had complained to him in the past that application forms were not being processed and that HNZ staff were asking for goods such as stereos.”
Stereos?! well at least they won’t show up on the bank statements. The Herald closed with:
“New Zealand Federation of Family Budgeting Services secretary Raewyn Fox said many of her clients were also clients of Housing New Zealand but she had never heard of bribery.
“I have heard mumbles about the waiting lists though,” Ms Fox said. “Even the suggestion that something like this has happened will damage their confidence,” she said.Housing Minister Phil Heatley praised HNZ for its “swift action”.
“Prospective Housing New Zealand tenants and the wider public must have confidence in the probity of the state house system. I’m confident all necessary steps are being taken to ensure that is the case,” Mr Heatley said.Mr Heatley said anyone with complaints about HNZ could call the authority’s complaints line in “absolute confidence” on 0800 801 601.”
Absolute confidence?
A typical call may go something like this “Oh yes, a while ago I gave this chick at HNZ my stereo so she wouldn’t ‘lose’ my paperwork again. You’re not going to take my home off me are you?” How many calls do you think HNZ is going to get from tenants who already feel “vulnerable” and “intimidated”?
We have a feeling that this one will run and run but we don’t think that HNZ’s complaint’s line is going to be red hot.
Stand by to see what else comes out of the woodwork over the next few days.
UPDATE 18 April – Sex For State Houses Allegations
Steve Hopkins of the Sunday News has written a piece saying that an Housing NZ investigation is underway following allegations that one of their workers abused his position to have sex with tenants:
“A South Auckland woman complained to HNZ that a staff member, who helped find her a property “just down the road from his”, pressured her and other HNZ tenants into having sex.
HNZ staff are forbidden from having relationships with clients under the Public Sector Code of Conduct.
The 50-year-old mother of five said: “He sees attractive women coming through his work. He befriends them at first but his real intention is to have sex with them. He’s a predator.”…
Read the rest of it HERE
Global Economic Crime Survey – Fraud Thriving In New Zealand
Despite the hype put out about New Zealand’s perceived ‘freedom from fraud and corruption‘ the reality seems to be very different, NZ has higher rates of economic crime than its closest neighbours and is way above the world average.
The Global Economic Crime Survey, carried out annually by one of the world’s largest accountancy professional services firms PriceWaterhouseCoopers, showed that a massive 42% of organisations in NZ had suffered from fraud in the last 12 months (against a global average of 30%) and 46% of it was committed by middle and senior management. The average fraud is costing around $500,000 in each business.
PWC is one a Big Four auditor, alongside KPMG, Ernst &Young and Deloitte Touche Tohmatsu so their report will carry a lot of credence. This is the largest international survey of its kind with over 3,000 organisations taking part across 54 countries. 85 organisations from across the public and private sectors took part in the survey: From the PWC website:
- Asset misappropriation (theft) was the most common form of fraud, cited by 86% of New Zealand respondents.
- Financial statement fraud was cited by 36%
- Intellectual property theft at 17%.
- In 72% of all cases the fraud was committed by someone inside the organisation.
“(The) survey shows that economic crime continues to be a serious issue affecting New Zealand organisations with the current economic crisis increasing the pressures and incentives to commit fraud. New Zealand had the eighth highest reported level of fraud across the 54 countries that took part, with 42% of our respondents saying that they suffered from some form of economic crime in the last 12 months. The average cost of fraud in New Zealand was $491,506 with one organisation reporting that economic crime cost them in excess of $7 million in the last 12 months.
Since (the) last survey in 2007 we have noticed a significant trend in the perpetrators of fraud towards middle and senior management. When we align that trend to the fact that New Zealand organisations say that staff reductions have resulted in fewer resources deployed on internal controls and that internal audit were being asked to do more work with less staff, we believe that there is cause for concern. It is people in middle and senior management that are more able to override controls within an organisation.”
“Perpetrators of fraud“
“Internal fraudsters were the main perpetrators in 72% of fraud reported by New Zealand respondents. This figure is significantly higher than Australia (33%), Asia Pacific (57%) and globally (53%). When we looked at the sector responses, the government and public sector in New Zealand had the highest rate of internal perpetrators with 89% of frauds within this sector committed internally.”
So much for New Zealand topping the international index for the least corrupt country. We are shocked the both the government and public sectors are involved. We’re now watching for a backlash against the report and expecting a damage limitation offensive to be launched any time now…….
See also
(Ex) MP Taito Phillip Field found guilty of bribery and corruption
Former immigration boss Mary Anne Field “consistently breached” the requirements of public servants to manage conflicts of interest.
Former list MP Donna Awatere Huata convicted of fraud
‘KPMG survey shows fraud costing NZ millions’ – poor internal control remains the major factor allowing fraud to occur with 49% of respondents experiencing fraud.
Today’s posts – click here
Taito Phillip Field Found Guilty
Former MP Taito Phillip Field has been found guilty on 11 out of 12 charges of bribery and corruption and various other charges related to obstructing or perverting the course of justice. The case was brought after allegations that Thai nationals received immigration assistance in return for working working on Mr Field’s property. See also Trouble in paradise
Mr Field once held the position of Minister outside cabinet, with the portfolios of Associate Minister for Pacific Island Affairs, Associate Minister for Social Development and Employment, and Associate Minister for Justice until he was stood down in 2005.
Migrant Tales
1080 Poison, 100% Pure?
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New Zealand crime news
- Woman critical after being 'dragged behind car'A woman was last night fighting for her life after being dragged behind a car for a kilometre on a stretch of North Island highway following a desperate attempt to escape a domestic dispute.
- Con artist failed to convince the Grim ReaperA morbidly obese fraudster who tried to argue he was too fat for jail died in custody after being taken to prison from a hospital bed.
- Pastor visits arsonist who torched churchFrom the ashes of an arson attack that destroyed a Feilding church has arisen forgiveness and reconciliation with the man responsible.
- Men jailed after gangland turf shootout near schoolTwo men involved in a gangland shootout just metres away from an occupied school have been jailed for their part in a Nomads versus Rebels turf war.
- Paroled killer's 'risky' actionsThe man convicted of the brutal rape and murder of a young woman in Palmerston North has had a rocky first few months of freedom, and has been slapped with a night-time curfew after some "risky behaviour".
- Police investigate Auckland shootingPolice are seeking witnesses to a shooting in Panmure, Auckland last night.
- No place left to feel safeAn elderly woman was allegedly sexually assaulted in her home by a mentally ill neighbour, raising questions over why she wasn't told she was living a short distance from a residential care facility.
- Horrific slaying site to be sold, torn downA Christchurch flat where teenager Hayden Miles was brutally murdered looks set to be sold and demolished.
- Erectile dysfunction drugs sold as herbal medicineAn Auckland pharmacist who illegally sold erectile dysfunction drugs as "herbal medicine" has been jailed.
- Teen hangout man arrestedA Queenstown man was charged with disorderly behaviour this morning after incidents at newspaper offices in the resort.
NZ Police Alerts News New Zealand
- Fatal shed fire investigatedLocation: National News West Coast Police and the Fire Service are investigating the cause of a fire in a shed at Kaniere, south of Hokitika overnight. Police have confirmed one person died in the fire. The body is yet to be recovered and formally identified. The fire broke out about 4.20am today. At this stage no further information on the cause of the fir […]
- Workplace survey results stay above sector benchmarkLocation: National News Levels of engagement by Police staff continue to remain well above the state sector benchmark, its annual independent workplace survey shows.
- Hamilton Police urge caution after road safety hit for sixLocation: National News As dawn breaks on a wet Waikato morning, Hamilton Police reviewing a series of crashes are urging drivers to keep their wits about them and drive to the conditions. Sergeant Phil Ruddell of the Hamilton Strategic Traffic Unit said one of the most frustrating aspects linking all six of yesterday's crashes is each was avoidable. […]
- NZ Police celebrating African UnityLocation: National News NZ Police is proud to be joining African New Zealanders in their lively celebrations which are set to mark the 50th anniversary of African Unity Day. Sponsorship of an Africa Day event to be held on Saturday 25 May at the Wellington Town Hall is part of police's wider strategy to build partnerships with these communities to prev […]
- E whakaae ana ngā Pirihimana ki te pūrongo Operation 8 (me te ataata)Location: National News Kua whakaae ngā Pirihimana ki ngā whakakitenga o te pūrongo a te Independent Police Conduct Authority mō Operation 8, ka mutu kua tahuri kē ngā Pirihimana ki te whakarerekē i ētahi o ā rātau mahi e hāngai ana ki te maha o ngā take i roto i te pūrongo. Hei tā te Kaikōmihana a Peter Marshall e harikoa ana ia i whakaae te IPCA he ‘he wh […]
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