New Zealand’s $1.4 billion money laundering problem


New Zealand has long been viewed as a soft spot for money laundering, high end fraud, among other crimes. Across the last few years numerous examples of money laundering activity in New Zealand or linked to New Zealand businesses have appeared

  • In 2016 an expert said that New Zealand banks were missing large numbers of suspicious monetary transactions
  • Also in 2016 the so called Panama papers showed how a steady flow of foreign cash into New Zealand became a flood as its holders sought to avoid it being taxed in the proper jurisdictions
  • The same year John Shewan’s report found 12,000 foreign trusts existed in New Zealand – a number that plummeted to 3,000 within a year suggesting many were used for money laundering or other improper monetary purposes
  • In August 2019 $9 million was seized in an anti-money laundering sting in Auckland
  • Just a few days ago the Chief Executive Officer of Westpac resigned after allegations that Westpac failed to pick up 23 million individual breaches including payments to Philippine based child exploiters

Now it has emerged that New Zealand has a N.Z.$1.4 billion money laundering problem. This estimate does not include the domestic cheats who do not pay due taxes to Inland Revenue Department. Globally it is part of what the International Monetary Fund believes to be a $6.5 trillion problem.

New Zealand needs to crack down hard on money laundering. As the resignation of Mr Hartzer shows, money laundering can be linked to some extremely dark criminal activities including child exploitation. A significant part of the crack down would need to ensure a long term budget increase for the police unit investigating financial crime. There would also need to be a revisit of the amendments made to the Anti Money Laundering and Countering Financing of Terrorism Act 2009.

The Government seems to be rising to the challenge. It has made changes that took effect in January for real estate agents. In August changes for the racing industry and businesses with high value products regarding the need to comply with the A.M.L.C.F.T. Act took effect. In 2018 the obligations for businesses providing trust services, lawyers, conveyances and accountants were changed.

But there is more that can be done. I believe that tightening the sentencing regime for those convicted of money laundering, conspiracy to participate in money laundering and providing support for those involved in it can be tightened up. Whereas many of the people who commit offences against the human body are disturbed, come from messed up backgrounds or may simply not have had a loving family to show them right from wrong, organized crime is quite different. The victims of money laundering – although individual victims certainly exist – are whole communities, businesses and in the worst cases the reputation of entire nations.

Whereas the impacts of rape, murder and so forth – certainly not trying to put any of these crimes down in terms of their gravity – on the individual, the family and their lives are well documented, how well do people know about the absolute worst of white collar crime? How well do we know what we as a society, as a nation and as a people are missing out on by not tackling money laundering and the people who engage in this kind of activity?

I fear the answer is not very well at all.

National’s lack of ideas not helping


Here we go again. National trotting out the tired old mantra of cracking down on crime and gangs in the equally tired belief that more punitive measures that seek to lessen the prisoners as people are somehow necessary. Certainly in the world of National leader Simon Bridges this is what one is expected to believe.

The problem is lowering taxes and getting tough on prisoners and gangs is so unoriginal, the radical aspect of them might be just how unoriginal these ideas are.

How many past National Governments have promised to “get tough on gangs” or “crack down on crime”? Mr Bridges is certainly not the first to promise that if elected to office – and given National’s apparent desire to remain stuck in the 1900’s – probably not the last either.

Mr Bridges might do well to talk to a few people, including former National Party Members of Parliament such as Bill English that have realised that after all this time, the “get tough on crime/gangs” mantra just is not delivering any more. They have realised that the ambulance is at the bottom of the cliff in terms of treating potential criminals and vulnerable people who might be influenced by criminal activity when it should be at the top.

It is all very well that Mr Bridges was a Crown Prosecutor and that he would have seen some nasty cases whilst in court. I do not blame him for being horrified at the social cost to society and the victims, but I honestly wonder if he prosecuted in any cases where the offender offended because jail was the best place s/he had been in their lives. They do happen and are damning yet sad cases that point to systemic failure right through the societal system – did they have a troubled childhood including expulsion or suspension from school; were they abused; what sort of parental figures did they have in their lives; did they have to be put in the care of the state?

Another idea that is old and ratty, yet one that National push every election is to lower taxes. One of the oldest and most sacred ideas of the right-wing of politics is also one of the ones that has never really realised its stated potential. I never hear anything about making sure that the New Zealand tax code is fit for purpose or that measures are being taken to close as many tax loopholes as possible. Nor do we hear of politicians working to  ensure that corporations and wealthy individuals pay in full what is expected of them at the time it is due.

National says benefit fraud costs the nation dearly. This is rather rich considering if all wealthy figures and companies paid their tax in New Zealand in full and on time, there would be around another N.Z.$7 billion in additional funds available to the Crown. The same party says that it will clamp down on welfare, which again is hypocritical when one looks at the support that goes to corporations and wealthy individuals who in some cases completely ignore their tax obligations.

How keen is National to win the next election one might wonder after reading this. Good question, because announcing same old ratty dust covered policies that make even the worst second hand books look rather more exciting is the political definition of insanity. But if you believe Simon Bridges, the liberal 21st Century ideas of giving prisoners doing shorter jail sentences their voting rights back is somehow going to aid and abet crime.

Labour and coalition partners climb in poll; National drops


A YouGov poll just out shows a gain in the number of seats every party in Parliament except for National, were an election held today.

After a slump over the last few months following the outpouring of respect for Prime Minister Jacinda Ardern’s leadership in dealing with the Christchurch Mosque attacks, Labour can afford to smile again. Its 41% support in the YouGov poll would leave it with 51 seats in Parliament, five more than its current 46.

National Party leader Simon Bridges would be disappointed with the results, but a determination to rehash old ideas is not helping the centre-right party. Thanks to Mr Bridges outdated views on justice and his sudden insistence on the importance of being tough on crime when National failed to make any substantive changes in sentencing, it has slumped to 40 percent. That would see it surrender 9 seats to the other parties to leave it on 47.

New Zealand First and the Greens both do alright in the poll, and would have 10 seats a piece. That would give New Zealand First another M.P. and the Greens two more M.P.’s. Notably though, this was taken before the donations saga became known to the media – I do not imagine the public would have been so kind if they had known this beforehand.

Even A.C.T. for the first time since 2011 would have more M.P.’s, as its 2% plus assuming leader David Seymour is returned in Epsom would bring in an extra M.P. That would be the only bright spot for A.C.T. though as with National on 40% in this scenario, the right wing of New Zealand politics would be comfortably stuck on the Opposition benches.

However if the New Zealand public had known about the allegations embroiling New Zealand First before the YouGov poll was conducted, it is unlikely they would have been so kind to New Zealand First. The allegations, which point to serious fiscal mismanagement inside the party stem from disgust over years of opaque governance by the New Zealand First board of directors with regards to the party’s financial position.

If we held the YouGov poll today, with the fallout from the New Zealand First donations problem accounted for, this is how I expect the results would look (% / # of Seats):

  • LABOUR 42 / 54
  • NATIONAL 40 / 47
  • GREENS 9 / 11
  • N.Z. FIRST 5 / 6
  • A.C.T. 1 / 2

This would be devastating for New Zealand First Leader Winston Peters. It would leave his South Island membership with no representation in the House of Representatives as Mark Patterson, a list M.P. in Clutha-Southland would be forced to leave Parliament. Labour, A.C.T. and the Greens have all had legislative victories of late or  – in the case of the Greens – M.P.’s comments going viral and starting a discussion. These would have raised their profiles somewhat and proven that they were keeping their promises, and combined with National’s surprisingly poor performance, would help to prop them up.

With the 2019 Parliament year soon to end and the 2020 campaign year just over 5 weeks away from starting, Ms Ardern might be cautiously smiling at the moment. But if the donation saga drags on and causes the conservative N.Z. First voters to leave it might be Mr Bridges with the biggest grin this time next year.

Oil and gas policy the Government’s biggest gamble


A few weeks ago the Zero Carbon Act passed through Parliament with assistance from National. It might have been a great day for the political career of Green Party co-leader James Shaw, Prime Minister Jacinda Ardern and the environmental faction then. But it comes at considerable long term risk that cannot be ignored in the provinces.

Several provinces will be directly impacted by the move away from fossil fuels. None more so than Taranaki, but Westland (coal) and Northland (refinery) are hot on its heels.

I honestly do not think the Government has thought it through. A broad, grand brush stroke is meaningless without substantive policy and matching investment in alternatives, which at this stage does not appear to be something viewed as a priority by either the Minister for Energy and Resources Dr Megan Wood or the Prime Minister.

I have stated my ideas about what should happen clearly. A potential hydrogen plant support a transition away from petroleum; the exploration of hemp as a building material since concrete manufacture releases a lot of carbon dioxide; waste to energy as an alternative source of electricity among others. I am believer in the green technological revolution and I believe New Zealand has the means and the know how to show other small nations how they can transition to a more sustainable energy platform. I am believer because there are jobs to be had, research to be done which will draw in skilled workers and infrastructure projects – should that research be positive – that could go ahead.

Since the announcement, I have heard little from Dr Woods, Ms Ardern or Mr Shaw on how they might mitigate the economic impact that they must surely know is going to be had on the country. They must surely be aware that National is going to push the economic consequences of this as hard as it can as it seeks to wrest back control of Government from Labour-Greens and New Zealand First.

To be sure the Government has passed the Zero Carbon Act, with National Party assistance on the understanding National will make changes when it next wins the election. But little has been said about developing a working group or other framework to steer this change. Nothing has been said about obvious minor steps such as recycling aluminium to reduce electricity consumption, some of which are also quite easy steps to take.

Overall I feel that this is the Government’s biggest gamble. It might pay off if it sets a precedent for other countries to follow, but I get the feeling that New Zealanders are not going to come on board until they see a plan, irrespective of what Extinction Rebellion, Greenpeace and other N.G.O.s might think about this. People are understandably concerned about their incomes, being able to provide for their families and make sure that their children have all of their needs provided for.

Unless this gamble is given some solid policy to back it up with aside from the Zero Carbon Act, I believe this is the gamble that might cost the Sixth Labour Government the election.

 

 

Sorry Grace


Dear Grace Millane

This is a horrible article to write. It is horrible by virtue of the circumstances leading to it, which should have never happened.

So, your killer has been convicted by a jury that took 5 hours to reach a verdict. I can only admire their stamina going through that and am not surprised that they have been stood down from jury duty for the next 7 years. They would have seen some horrible evidence of a cowardly brutal murder committed by a person who it appears was a prolific liar.

I can only admire the police that handled the case, who would have had the god awful task of telling your family that they had lost their daughter in what should have been a fantastic once in a life time trip. What an awful job to have to do.

I am sorry Grace. I am sorry that my country was where you took your last breath in what would have been absolutely horrendous circumstances. You should have been safe here. You should have been able to enjoy all that Aotearoa had to offer and you appeared to be having a magnificent time doing exactly that. You met a man who you thought you could have some intimacy with and who appeared to be getting on well with. You should have been able to leave that room and enjoy your 22nd birthday and the hopefully many more that would have followed.

I can only hope as do my fellow New Zealanders that your killer gets the due sentence. I hope that the New Zealand justice system gives your parents a sense of closure on what without doubt would have been the most shocking, horrible experience they and the rest of the Millane family should never have had. It will never bring you back from the dead. It will never make your parents, and siblings lives what they would have been with their vivacious daughter, sister around to cause hilarity, mischief and rain down love.

I am sorry that you will never get to live the full and happy life you so richly deserved to, because of one man’s cowardly act.

Sorry Grace. Except in the eyes of your killer, it really honestly was not meant to be like this. You were meant to be able to go home or continue to travel after finishing in New Zealand happy with what you accomplished, full of awesome memories of the places you went, things you did and the people you met.

You were meant to be able to find a job, a place to live, someone who genuinely loves you and be able to love back. You were meant to be able to be so much more than this, a horrible part of the New Zealand homicide statistics for 2018. The only stat you really should have been was another visitor to these shore who had a great time and went away happy and content.

But because of this cowardly act, you are not.

I am sorry Grace.

Fly with the angels.