Looks very suspect

Martin van Beynen reports:

Canterbury Earthquake Recovery Authority’s (Cera) staff employed to bring investment to Christchurch set up their own company through which investors would pay them a fee on private property deals, a Stuff investigation has found.

The senior public servants were employed by the Cera investment facilitation team, but at the same time had their own company which offered investors property proposals in the hope of earning a large finder’s fee.

The private dealings have emerged in relation to the sale of the damaged Youth Hostel Association (YHA) building at 273 Manchester St in late 2014.

 Emails and company documents show three Cera staff working for the investment team – Murray Cleverley, who was manager of the Greater Christchurch Investment Strategy, and two investment facilitators, Gerard Gallagher and Simon Nikoloff – were involved in the transaction at the same time as being employed by Cera.

Cleverley is a property investor and the chairman of the Canterbury and South Canterbury District Health Boards. Nikoloff and Gallagher work for Cera’s successor Otakaro Ltd, which is tasked with delivering the Government-led anchor projects and managing Crown assets, including surplus land in the central city and the residential red zones. 

The Cera staffers say they were entitled to do private deals and a company they set up to do so was formed “with the full knowledge of our employers”.

I think this stinks, and should be investigated. I am not saying any laws were broken, but public servants should not be running a company on the side in an area in which they are employed.

Stuff has learned that Gallagher and Nikoloff approached the Youth Hostel Association in what it perceived was their capacity as Cera staff, around the same time as the company was formed.  

The two Cera staffers then began promoting the building, and other properties, through their private business, to Sydney mining services tycoon Kevin Maloney and his representative Ewen McKenzie, a former Australian rugby team player and coach.

If YHA thought they were then in their public capacity, and they used to to gain business for their private interests, that is wrong.