SFO’s National and Labour Party donations cases to be heard together, High Court rules

Two criminal cases over allegations of unlawful donations to both the Labour and National parties will be heard together at a joint trial, the High Court has ruled.

In a decision released today after a two-day hearing earlier this month, Justice Ian Gault granted the Serious Fraud Office’s (SFO) application to join the two cases and hold a single 10-week trial.

However, the reasons given in the judgment and submissions made by lawyers – which includes six Queen’s Counsel – remain suppressed. The identities of the six people charged by the SFO in May after an investigation into donations made to the Labour Party in 2017 also remain suppressed and is due to be argued at a future but yet to be scheduled hearing.

The SFO had already charged former National Party MP Jami-Lee Ross, brothers and businessmen Shijia (Colin) Zheng and Hengjia (Joe) Zheng, and New Zealand Order of Merit recipient Yikun Zhang in January last year.

This followed an investigation into donations of $100,000 in 2017 and $100,050 in 2018 to National, which was prompted after Ross went public with allegations against former party leader Simon Bridges, who has strenuously denied the claims. Ross then laid a complaint with police, sparking the SFO inquiry.

Ross and the three businessmen deny all the charges which accuse them of adopting a “fraudulent device, trick, or stratagem” which resulted in the donations being split into sums of money less than $15,000.

A registered party must declare in its annual returns the identities of those who donate, contribute or loan more than a total of $15,000 in a given year, regardless of how many donations make up the amount.

Justice Gault today also granted the SFO’s application to amend the National donations charges to add an additional alleged benefit obtained by the defendants.

Ross, the former Botany representative who campaigned for the 2020 election with the minor and controversial party Advance NZ, has claimed he is a whistleblower on alleged donations deception.

“There is no own goal,” he told the media after his first court appearance.

The National Party, however, has maintained it was never involved in an alleged criminal activity and said Ross had a “vendetta”.

“The party expects the trial of charges against Mr Ross will involve evidence which will inform the public of the true facts,” a party spokesman earlier said.

In February, Ross also agreed to destroy an electronic copy of SFO documents inadvertently “leaked” to him. The papers, which Ross waved in the House of Representatives last year, contained confidential information regarding donors to National in 2017 and 2018.

A trial for the National Party donations allegations had been scheduled for September but was adjourned.

Court documents earlier released to media by the Auckland District Court show the Labour donations group face 12 total charges.

Each of the accused are charged with two counts of obtaining by deception over a donation of at least $34,840 for the Labour Party on about March 28, 2017. The SFO alleges the identity of the donor was not disclosed in the party’s annual return of party donations.

The group are accused of adopting a “fraudulent device, trick or stratagem” where the donation was paid via an intermediary account before being paid to, and retained by, the Labour Party.

Court papers also allege the group provided five names to “create the illusion” of five donations of sums of less than $15,000 to conceal the amount and identity of the actual donor.

The accused six are also further charged with unlawfully obtaining a benefit for the true donor by allowing them “freedom from any public scrutiny”.

After the charges were filed, Labour Party general secretary Rob Salmond said in a statement that the party has “complied with the law.”

Prime Minister Jacinda Ardern also indicated there needed to be legislative reform because of the number of cases involving political parties.

“This isn’t a good environment for anyone, for no political party, but nor for New Zealanders. They want to have confidence in the system, so let’s look at the law,” she said.

Two people with name suppression have also been charged by the SFO over donations made to the NZ First Foundation, while police referred an inquiry in April to the SFO over donations to the Māori Party.

The NZ First Party attempted to stop the charges from becoming public until after a government was formed in the wake of last year’s election. The accused pair have denied the charges and a trial is due to start in June.

Auckland Mayor Phil Goff’s campaign expenses are also the subject of an SFO investigation.

Goff’s former Labour Party colleague and Christchurch Mayor Lianne Dalziel also had her expenses investigated but she has since been cleared.

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