Labour’s art auctions

Stuff reports:

The Labour Party is hiding tens of thousands of dollars in donations behind over-inflated art auctions – and naming the artists as donors instead of the secret individuals handing over the big bucks.

The artists had no idea the party was naming them as the donors – they never saw a cent of the money. They say their works are auctioned off at well above market value to wealthy benefactors who want to keep their support for the party secret.

Labour says the practice complies with electoral rules. But one party operative described the practice as “whitewashing” – a way to keep big donations private at a time when corporate contributions to political parties were falling because of public scrutiny.

So who runs this whitewashing?

Wellington artist Karl Maughan provided Labour with two paintings for auction in the last year. He said he gave them to campaign staffer Barbara Ward, who works for Labour leader Jacinda Ardern.

No doubt she knows nothing about it, just like she knew nothing abotu what Chris Hipkins was doing.

“What’s the value of a painting?” the operative asked. “It’s hard to put a price on it, not like a car or an airfare or something that can easily be valued. But a painting can’t be valued, and that’s exactly how auctions are used to launder the money.”

This is the key. Let’s take another example. Say a car dealer donates a car to a political party for a fundraising auction. The car sells for $35,000. The car normally sells for $25,000 so it is treated as two donations – $25,000 from the car dealer and $10,000 from the buyer. That is fair.

But art is very very different. As each art work is unique establishing the market value of a painting is highly subjective. And in this case Labour is claiming very high market values, so that the contribution from the buyer falls below the $15,000 disclosure level.

At the last Labour art auction, they sold three works by Mt Eden artist Stanley Palmer, from a numbered series of 20 prints of the end of the road at Karamea, on the west coast of the South Island.

Palmer believed the $20,000 paid for the three was what they were worth – but admitted they would usually have sold for around $2400.

If they would normally have sold for $2,400 then the amount that should be disclosed is $17,600.