Not a surprise

Matt Shand at Stuff reports:

NZ First leader Winston Peters and high-ranking MPs were briefed about the NZ First Foundation’s expenses and activities one year before it first made headlines, Stuff can reveal, contradicting Peters’ consistent claims the foundation had nothing to do with his political party.

Stuff has seen an internal party report that, according to a source familiar with the matter, was presented to Peters in November 2018.

The report, dated 21 November 23, 2018 [sic], was written by former party president Lester Gray. It is understood that it was hand-delivered to Peters’ home mailbox in Auckland on Sunday, November 25, ahead of a meeting about the matter.

The report referenced money in NZ First Party’s Kiwibank account as well as money in the Foundation’s ASB bank account. It totalled expenses incurred by the ASB account and classed them as party costs.

This is no surprise, to put it mildly.

Invoices addressed to Winston Peters or his office were paid by the NZ First Foundation. Now this doesn’t happy by magic.

Someone in Winston’s office has to give the invoice to the Foundation and ask them to pay the bill. And it is hard to imagine that Winston’s staff were doing this behind his back!

Stuff has also seen a separate memo written by the party’s then acting treasurer, John Thorn, to the “board of directors”, dated May 5, 2017. It reveals that the foundation was originally proposed to be a “capital-protected fund”, meaning contributions would never be spent, only profits from the fund’s investments. It was originally meant to be operated “at arm’s length” from the board.

The memo states the foundation would be modelled on the National Party’s National Foundation, which is a capital-protected fund. It states: “there can be little doubt that the model is legally sound and is operated in a manner that meets all legal and ethical obligations”.

However, previous Stuff stories have revealed the New Zealand First Foundation actually operated as a party slush fund. The capital was spent on all manner of party expenses, including campaign headquarters, office furniture, wages and other campaign costs. Some donors who thought they were donating to the party were actually donating to the foundation.

My theory is that this was a con job on the board.

The board were sold the Foundation as a capital fund, like National’s. That is why they agreed to it. But then once established it turned into a slush fund receiving money and paying bills on behalf of the party, but hidden from the party’s board.

And recall the former President and Treasurer resigned over this issue – they they weren’t being given the financial information they wanted.