The High Court fraud case against two men around donations to the New Zealand First Foundation ends, with the defense asking why neither the Serious Fraud Office nor the Crown called on the party leader
The defense lawyer for the two men accused of donation fraud in the NZ First Foundation trial said the Crown and Serious Fraud Office had neglected to call upon a crucial witness – Winston Peters himself.
Tudor Clee said the Crown’s argument that two men had obtained up to $750,000 in political donations by deception was based on a “pattern of erroneous assumptions”, and failed to prove the charge beyond a reasonable doubt.
Clee’s closing arguments for the defense to Justice Pheroze Jagose at the High Court at Auckland on Monday alleged that despite the weeks-long trial and 60 witnesses, the Crown had been unable to produce a single witness alleging criminal activity.
“This case, your honor, is a suspicion searching for a statute,” he said.
Clee argued the charge of obtaining by deception was the SFO trying to frame the men’s behavior as criminal rather than simply in breach of the Electoral Act.
“This was an attempt by the SFO to shoehorn an offense under the Electoral Act under the Crimes Act,” he said. “…simply an attempt to find criminal liability on an allegation that was not criminal.”
He pointed to changes in the charges since news of the foundation’s fundraising first came to light in 2019/2020, saying the amount of time it took, and the rewording of the charge, showed the crown as having a weak case.
“This allegation took 20 months to come to fruition with no new evidence, no new witnesses and no new information,” he said. “This summarizes the uncertainty of the Crown case.”
And through the days of witnesses and donor statements talking of the inner workings of NZ First and its financial set-up, there had been one leading figure who had not made an appearance.
Winston Peters – the near 30-year leader of NZ First – has been everywhere and nowhere at once in the case, appearing on the lips of almost every witness to take the stand and showing up by name in countless emails and letters.
Yet, despite his central role in the ecosystem of the party, neither the Crown nor the SFO compelled him to give evidence in the trial.
Clee said the SFO had the power of compulsory interview and the Crown had the ability to subpoena Peters to appear: “None of that happened.”
The defense alleged the Crown “failed to call an obvious witness”.
“There is a sole person who has been on the board the entire time,” Clee said. “He was never called and we have not had adequate explanation as to why that is.”
Clee argued Peters’ leadership of the party made him a “key witness”, and that witness evidence showed Peters held the purse strings within the party and therefore likely had some knowledge of the workings of the foundation.
He referred to a meeting in November 2018 when then-MP Clayton Mitchell approached Peters for reimbursement for a trip to the United Kingdom to network with Nigel Farage and his Brexit Party.
“We talked about his reimbursement, I put it to him that would indicate that Mr Peters had control over the funds,” Clee said. At the time, Mitchell said that was “potentially” the case.
When asked if Peters had financial control, Mitchell answered “what Winston asks for generally gets delivered”.
“Obviously the Crown… made a number of assumptions not supported by evidence,” Clee said. Despite evidence showing Peters had delegated authority from the board for expenditure, the Crown’s argument suggested he could have been in the dark about the workings of his own party.
“What the Crown is saying is that Mr Peters was duped. If that’s the case sir, what was the point of not calling him?” Clee said, “The Crown never interviewed him. All the court can do is draw the inference” that the SFO decided Peters’ testimony would run counter to the case they were making.
Clee said the charge of obtaining by deception needed Peters himself to be deceived by the defendants, saying the party secretary had no property rights over the money in question and therefore could not be the victim of the crime.
“[Peters] was aware of the structure that was set up…. there was no suggestion it would make any sense for this to have been set up for the detriment of the party,” he said. “The crime is premised on property…; we submit the leader understood the structure… we submit the structure cannot be a fraudulent device or stratagem unless Mr Peters was tricked.”
Clee said without any proof that Peters had been tricked, “the opposite can be the only inference”.
“Without Mr Peters’ complaint to the Crown, which does not exist… this charge without his support is baseless,” he said. “It has been conducted deliberately with neither his complaint nor his evidence.”
Last Thursday in closing arguments for the Crown, lawyer John Dixon QC said the party was broader than just Peters, and that he could have been unaware of some financial goings-on.
“There’s evidence in questioning from the defense – an argument that Mr Peters was and is the party, Mr Peters knew and approved of what was going on,” he said. “It’s my submission Mr Peters is not the party. The party is wider than that and represented by a number of witnesses who gave evidence. This is not to say that Mr Peters did not know some of what was going on but it cannot be sensibly argued that Mr Peters had full knowledge of the true picture.”
Dixon said if it was the case that Peters knew fully what was going on, he should be viewed as an “uncharged co-conspirator”.
Clee rejected this claim, saying it was “baseless” and “shows the prejudice and confusion of the prosecution”.
“The allegation was made without consulting Mr Peters and we are concerned about the professionalism,” he said.
The defense closing examined whether the actions of the suspect matched the charges that had been laid – specifically, whether the money was obtained by deception and just who had been the victim.
“It would seem circular” for money to be obtained by deception for benefit of an affected party, Clee said. “The case law is clear that the affected party must be the person deceived.”
He argued purposeful intent to deceive what was necessary for the charge to stick.
“Evidence of SFO analysts is the monies were used for the benefit of the party,” he said. “[There was] simply no evidence the defendants used the money for themselves.”
Last week, Dixon said the end result was not the important thing, but whether the defendants unlawfully had control over the funds.
“The Crown accepts the defendants did spend the money on a range of expenses that did have the potential… for the benefit of the party,” he said. “It was the defendants who determined and controlled how that money was spent, not the party.”
The two defendants’ identities remain suppressed, with a hearing expected next week.