INVESTIGATEMAGAZINE.TV

April 29, 2008

Vector Energy sold to Chinese spy?

ANY STORM IN A PORT

China's Trojan horse in NZ

[The following story initially ran in the April 06 edition of Investigate magazine, but is directly relevant to the purchase announced April 28, 2008 of Vector Energy's Wellington grid by the same businessman]

The Hong Kong business conglomerate trying to purchase a stake in some of New Zealand's biggest port companies [and now the purchaser of energy company Vector] has been named as a front for the People's Liberation Army of China, and some of its associates have been caught shipping weapons and alleged WMD technology. IAN WISHART has more

 

His name is Li Ka-shing, and if his name sounds like a cash register there's a very good reason: this 77 year old Chinese businessman has just been ranked by Forbes magazine as the tenth wealthiest person in the world, with a fortune estimated at nearly US$20 billion. His companies, including Hutchison Whampoa, account for 10% of the value of the Hong Kong stock exchange and have tentacles that reach across the globe – more than forty countries according to one estimate – and in industries as varied as mobile telephone networks, electricity grids, retailing, shipping and real estate.

Many New Zealanders may have become familiar with Li's work in the sixties and seventies, when his main business was making plastic toys with the infamous "Made in Hong Kong" imprimatur.

But there are two sides to the Li Ka-shing story. One is the traditional fodder of business magazines, lauding the rags to riches story of a billionaire whose father died after the Japanese invasion of China before World War 2, leaving a 12 year old boy with the task of earning enough money to feed his mother and siblings. It's a story of a man making wily business decisions, building an empire and showing aspiring MBA graduates how it's done.

And here's how one of those gushing business stories reads:

"The move by the richest man in Asia and one of the richest in the world to take a stake in the operation of the Port of Lyttelton is one that has potentially great benefits for Christchurch and Canterbury and ultimately the rest of the country," said the Christchurch Press in an editorial mid February.

"There is no need to be starry-eyed about the proposed venture. Li Ka-shing has risen from complete destitution as a refugee who fled the raping and pillaging of China by the Japanese in the 1930s to become a multi-billionaire.

"He did it by being an astute and hard-nosed businessman. He also did it, according to one account in a business journal, by 'remaining true to his internal moral compass' and operating with integrity."

Like we said, that's one side of the Li Ka-shing story.

The other side of Li Ka-shing is much darker, and less likely to be taught in graduate classes. It's the story of a man whose companies are regarded by Western intelligence agencies as nothing more than a money-making front for Chinese military intelligence as China prepares for what it sees as an "inevitable" conflict with the US.

As this 1996 diplomatic cable release by the US Government under a Freedom of Information request shows, Li Ka-shing's businesses didn't make money the hard way.

""Embassy Panama has received information to the effect that HIT (Hutchison International Terminals) is controlled by mainland Chinese, perhaps through a Macao front which allegedly recently invested $400 million in HIT," states the cable. "Such control would have security implications and might affect the Panamanian government's views on awarding the port concessions."

The "mainland Chinese" referred to in 1996 have turned out to be the Chinese Government itself, and more specifically its People's Liberation Army – more of which in a moment, but first some background.

Intelligence agencies have used what they call "arms length" front companies – genuine commercial operations whose owners are sympathetic to a particular cause. Back in the 1970s and 80s, for example, America's CIA set up a global freight airline, Air America, and a merchant banking operation, Nugan Hand Bank of Australia, to help launder money and assist with so-called "black operations" that the US government could not directly be involved in. Discretion, and plausible deniability, required "cut-outs" who could take the heat if discovered. One CIA front company, US accounting firm Bishop Baldwin Rewald Dillingham & Wong, even went so far as to open an office in Auckland in 1983.

But there's one difference between CIA front companies and Chinese ones. Ultimately, the US government takes a major PR-hit when dirty covert operations are uncovered. The Chinese government suffers no embarrassment when caught spying, because of its tight control of Chinese citizens and the lack of democratic accountability.

Investigate enjoyed a world exclusive in March 2000 when it reported that Chinese businessman James Riady, wanted for spying and illegal payments to the US president, Bill Clinton, had been in New Zealand as a guest of the National Government and introduced to Clinton at APEC.

Ever since Clinton was elected to the Whitehouse in 1992, China has bought influence in American politics by using businessmen like Riady and Li to donate to Presidential campaign funds, or the election campaigns of key senators and congress representatives. As a result, when America's lease fell due on the Panama canal in 1999, the Clinton administration let it slide, and Li Ka-shing's Hutchison Whampoa picked up control of the crucial ports at either end of the Panama canal. According to US reports, Hutchison also paid substantial bribes to Panamanian officials to secure the deal.

Amazingly, the deal also allows Hutchison to transfer its control of the Panama facilities to any other organization or country of its choosing, meaning it could – in the lead up to a conflict – effectively place the canal directly and officially in the control of China, allowing Chinese military and naval forces to legally occupy and defend their beachhead in the Americas. Because of the immense strategic importance of the Panama canal, any military attack on it could cause damage making the canal impassable regardless of who controls it, thus limiting US options.

Newssite WorldNetDaily reported a 1995 diplomatic cable from the US Embassy in the Bahamas revealing Hutchison had just been given the go ahead to build a US$88 million container port there. The embassy copied its cable to the Drug Enforcement Agency and US Customs, noting the possibility of a major increase in smuggling through the Hutchison facility.

They were right to be concerned. There are growing reports of a strong Chinese organized crime presence in Panama.

Some analysts fear the US is becoming more vulnerable to "Trojan horses", in the form of cargo or container ships that dock containing weapons of mass destruction and/or short to medium range ballistic missiles, leaving America vulnerable to a surprise attack with no possibility of missile intercept because of the short ranges involved. Indeed, this has been one of the security fears over the past month because of a bid by a Dubai-based company to take control of major US ports – the possibility that weapons of mass destruction could be smuggled in through civilian ports controlled by foreign interests.

Al Qa'ida has already been implicated in smuggling Islamic extremists into the US across the Mexican border, but China is equally active in shipping the ingredients of terror through commercial operators. Li Ka-shing, for example, sits on the board of CITIC, the China International Trust Investment Company, which has also been active in New Zealand business circles and still has a presence here. But US investigations have determined CITIC is also a People's Liberation Army front company, and during the Operation Sidewinder investigations in Canada recently authorities discovered quantities of weapons had been supplied by a CITIC company and stored on Mohawk Indian reservations.

CITIC was also in the news at Christmas after signing a US$900 million contract to build an aluminium smelter in Iran. Aluminium tubing is used in the production of missile technology and nuclear weapons.

China's state owned national shipping company COSCO, again a 50% joint venture partner in some of Li Ka-shing's operations, has been implicated in the sort of activities that would make the CIA blush.

"Both U.S. Senate and Canadian intelligence sources have described COSCO as "the merchant marine for China's military"," reported Canada Free Press last year.

"According to U.S. intelligence reports, COSCO vessels do not just transport Oriental bric-a-brac. COSCO vessels have been caught carrying [two thousand AK-47] assault rifles into California and biological-chemical weapons components into North Korea, Pakistan, Iraq and Iran. Add to these disturbing events that Canadian law enforcement agencies have kicked in with hard-line information that Chinese Triad criminal elements are active in and around Canadian ports."

But it isn't just smuggling items in, there is also the question of Chinese spies operating through front companies to smuggle information and technology out of countries like Canada, the US, Australia and New Zealand – all of which have been named internationally as prime targets for Chinese intelligence.

According to the Canada Free Press report:

"Conspiracy theories were tossed out the window when U.S. Congressman Dana Rohrabacher revealed that the U.S. Bureau of Export Affairs, the U.S. Embassy in Beijing and the Rand Corporation had identified Li Ka-Shing and Hutchison Whampoa (Li's primary business) as financing or serving as a conduit for Communist China's military in order for them to acquire sensitive technologies and other equipment."

But again, Chinese intelligence is one step ahead of the West. Just as Bill Clinton had been paid off in the US in order for China to gain access at the highest levels, so too was the-then Canadian Prime Minister Jean Chretien:

"Former Prime Minister Jean Chretien's connections to the burgeoning CITIC conglomerate served as his entrée into the private sector," says Canada Free Press. "While John Turner was leader of the federal Liberals, Chretien was working for Gordon Securities, one of the many Li-controlled companies on Canadian soil."

According to Canada Free Press, Operation Sidewinder was "sideswiped" after political pressure from Chretien.

With the Chinese military currently embarking on the most rapid rearmament in world history, the involvement of Chinese commercial entities should come as no surprise.

An American Defense Council report published two years ago paints an extremely disturbing picture for the West.

"Li Ka-Shing, the leader of Hutchison Port Holdings (China's primary shipping line), has close ties to the Chinese Communist Party and to the CITIC. The CITIC is believed to serve as a funding umbrella for the Chinese military, supporting the acquisition of military-related technologies. Hutchison Port Holdings manages, operates and is in possession of significant portions of three of the world's top five ports as measured by both the number of containers shipped and total tonnage shipped.

"China's other two huge shipping lines are directly controlled by the Communist Party. One, the China Ocean Shipping Co (COSCO) was described in the Cox Report issued by the US Congress as follows: 'Although presented as a commercial entity, COSCO is actually an arm of the Chinese military establishment'."

According to the Defense Council report, there are 10 strategic global shipping "choke points" that are crucial to US oil and trade lifelines.

"In the last decade, China has succeeded in building, managing or operating strategic ports adjacent to, or, as in the case of the Panama canal, at the entrance and exit of seven of these 10 global shipping choke points."

What has not been widely reported is another paragraph in the Congressional investigation into Chinese spying:

"The Clinton administration has determined that additional information concerning COSCO that appears in the Select Committee's classified final report cannot be made public," concluded the watered down version released by the House Task Force on Terrorism and Unconventional Warfare.

COSCO already has a strong presence in New Zealand, with offices in Auckland and Christchurch and a container line service that runs into Auckland, Tauranga, Napier, Wellington, Nelson, Lyttelton and Port Chalmers. Four of its vessels here, including the Aotea, are Panamanian registered.

While there is no doubt that COSCO routinely ships ordinary freight, every day, as any other commercial business does, there are also days when it ships the extraordinary, as this American news report notes.

"At least three arms shipments were traced from China to the Cuban port of Mariel during the past several months, according to an article Tuesday in the Washington Times. All the arms were aboard vessels belonging to the state-owned China Ocean Shipping Co., or Cosco, U.S. intelligence officials told the newspaper. The explosives were said to be "military-grade" material, the newspaper said.

"U.S. officials said Tuesday that the subject of arms trafficking between China and Cuba is a worrisome one, though they stopped short of confirming the Washington Times account. "We are very much concerned with this PLA [People's Liberation Army] cooperation and movement of military equipment in Cuba," said James Kelly, assistant secretary of state for East Asian affairs, when questioned during a hearing of the House International Relations subcommittee."

Questioning of Li Ka-shing is something Canadian government security advisor Scott Newark would like to do. He told the respected online journal NewsMax.com that a request by Li's Hutchison group to purchase ports in the US be given full congressional scrutiny.

"I'd like to suggest that the appropriate congressional committee hold hearings and that they call Li Ka-shing as the first witness. I volunteer to be second, but frankly there are people far more knowledgeable than me in this regard, including for example the International Association of Airport and Seaport Police, which just held their conference in NYC. As a speaker at that conference I urged ridding ports of such crime and rogue government-connected companies, not making them the local constabulary."

According to NewsMax, Newark identified five critical port security issues: "preventing smuggling of drugs, guns and people; preventing export of stolen products; providing site security as a result of 9/11; preventing terrorism related smuggling; and preventing attacks on ships leaving ports."

To that end, Newark sounds a warning that is relevant for New Zealand authorities as they consider whether to approve a buy-in by Hutchison into Lyttelton and possibly the Auckland or Tauranga ports.

"We need full scrutiny of the principals of Hutchison Whampoa and all of their business or government-related associations, and any history of any activity of them or their associates – including links to organized crime and terrorist groups, activities or states supporting the same – that would raise concerns to any of the above.

"We should give full scrutiny to any relationship of Hutchison Whampoa, its partners, directors or officers with any foreign government that would raise concerns to any or all of the above issues."

If that isn't ringing warning bells at the Christchurch City Council and in the Beehive, it should be, especially as the Li's business partner – the Chinese military's "merchant marine arm" COSCO - is already a big player in New Zealand ports.

Both COSCO and Hutchison have faced this negative publicity overseas. In COSCO's case, it hired one of America's leading public relations companies to spin the strong business and economic benefits of trade with China to the news media and key politicians, while playing down the "unfounded and negative" stories we've just highlighted. According to commentators the PR ploy has worked, with coverage of the company in the US largely restricted to positive business and trade stories in the media.

Nor is Li Ka-shing a stranger to New Zealand business. In Australia, he's the majority owner of Hutchison 3G Mobile, but you might be surprised to learn Theresa Gattung's Telecom New Zealand holds the remaining 19.9% in a joint venture.

Ironically, it was only a decision by US telecommunications regulators to threaten a veto that stopped Li Ka-shing's Hutchison from buying the giant international phone network Global Crossing three years ago. The purchase would have given Hutchison the possible option of eavesdropping on phone and data calls being made on Global Crossing's planet-wide network of undersea phone cables linking all the continents. Global was also bidding for US Defence contracts at the time.

Li's business ventures with the Chinese military include the Guangzhou Aircraft Maintenance Engineering Company, a Chinese air force company 25% owned by Li; and a one-third stake in AsiaSat, also part owned by the People's Liberation Army.

The move by Hutchison Port Holdings Ltd (HPHL) to purchase the Lyttelton Port Company in Christchurch raises some more questions for Helen Clark's Labour Government to answer. HPHL is registered in the British Virgin Islands, the same Caribbean tax haven at the centre of our February story about the New Zealand Labour Party's biggest campaign donor, Owen Glenn. Coincidentally, Glenn is also a shipping handler who's managed to get a rare Class A business licence in China and is said to have influence in Beijing, but whose operations don't appear to stack up based on what Investigate was able to discover. Glenn funneled $500,000 into Labour's election coffers last year.

Is the New Zealand Labour Party receiving money from the Chinese Government through a complex web of shady business figures and front companies? At this point Investigate doesn't have enough information to answer one way or the other, but the magazine's investigations are continuing.

In the meantime, we have discovered Li Ka-shing has reserved the name Hutchison Ports New Zealand Ltd with the Companies Office. The deal relies at this stage on Christchurch City Holdings Ltd acquiring the 31% of Lyttelton port shares that it doesn't already own, and that purchase offer closes on April 8. If CCHL gets the shares it needs, it plans to sell down 49.9% of the port to Hutchison. But Hutchison would get majority control of the company actually running the port on a daily basis, effectively putting the Chinese Government in command of imports and exports out of Christchurch.

The Christchurch Press reports the deal was driven initially by Lyttelton Port Company management, but picked up by Hutchison Port Holdings executive directors Mark Jack and Richard Pearson – both apparently ex-pat kiwis. A search of Companies Office records lists a Mark David Jack, resident in Hong Kong, as sole director of Ardmore Hangars Ltd – set up last year – and Ardmore Aviation Services Ltd, set up in 2003.

We have been unable to confirm any New Zealand directorships for Richard Pearson.

Christchurch mayor Gary Moore has dismissed reported links between Hutchison and the Chinese military as the work of "conspiracy theorists" who'd been listening to a sole US congressman, and Mark Jack has told critics to ignore the bad media and concentrate on the company's economic performance – a carbon copy of the PR stance Hutchison has taken in the US.

But Gary Moore – as provincial local body mayors often are – suffers from not being privy to intelligence. If it was only "conspiracy theory", why was Hutchison forced to back away from Global Crossing? And if Moore is correct about only one congressman raising concerns about Hutchison, why did the South China Morning Post report that Hutchison's paid lobbyists in the US were targeting three, including the then Senate Majority leader Trent Lott and former US Defence Secretary Caspar Weinberger who testified Hutchison's takeover of the Panama canal would pose a security threat to the US?

And if Gary Moore is correct, how does he explain the now-released 1999 intelligence briefing from the US military Southern Command which states: ""Hutchison's containerized shipping facilities in the Panama Canal, as well as the Bahamas, could provide a conduit for illegal shipments of technology or prohibited items from the west to the PRC, or facilitate the movement of arms and other prohibited items into the Americas."?

We put similar questions to a spokesman for Christchurch City Holdings Ltd, the current majority owner of Lyttelton Port Company, and ended up in a slanging match where the response to the allegations was "so what if he is?". The spokesman pointed out that national security issues were something for the Prime Minister to sort out, and Christchurch was only interested in the commercial deal.

The spokesman referred to a statement by a US Clinton administration official in 1999 to the senate hearing that Hutchison Whampoa's operation of the Panama ports would have no impact on shipping movements, and that the company had no known ties to the Chinese government.

However, those claims have already been tackled by the Washington Times' Insight magazine:

"Western policymakers and business leaders have little or no idea of China's grand strategy and how Beijing's leaders want to situate their country for the next century. When, in 1999, Sen. Trent Lott (R-Miss.) sent Insight's report, "China's Beachhead at Panama Canal," to then defense secretary William Cohen, he called for a full national-security appraisal of the problem. Lott told Cohen, "U.S. naval ships will be at the mercy of Chinese-controlled pilots and could even be denied passage. It appears we have given away the farm."

"At Lott's request, the Senate Armed Services Committee held a hearing in which four Clinton-administration witnesses testified that Hutchison Whampoa posed no security challenges to the United States [see "PC Answers on Panama Canal," Nov. 22, 1999]. But not one of the witnesses could answer the fundamental question, posed by Sen. Robert Smith (R-N.H.): "Do you believe the People's Republic of China uses commercial enterprises to advance their military interests?"

"Bill Clinton's assistant secretary of defense, Brian E. Sheridan, who had issued a defense of Hutchison Whampoa, confessed, "I don't know." Alberto Aleman Zubieta, whom Clinton had appointed to run the Panama Canal until 2005, didn't answer either. Neither did Joseph W. Cornelison, the deputy administrator of the Panama Canal Commission, nor Lino Gutierrez [the official referred to by Christchurch City Holdings Ltd's PR man], then principal deputy assistant secretary of state for Western Hemisphere Affairs. All had contradicted their testimony. Only Marine Gen. Charles E. Wilhelm, then chief of the U.S. Southern Command, answered affirmatively to whether Beijing uses commercial enterprises to advance its military interests, saying only: "I think so."

"That was it. And apparently the government has learned little since. "Many of those who are engaged in China policy or who invest there remain blithely ignorant of Chinese goals to replace the United States as the reigning world power," says Thomas Woodrow, a former senior China analyst at the Defense Intelligence Agency."

Lino Gutierrez is the Clinton official whose testimony was used to rubbish suggestions of Chinese government investment. He told the senate hearing:

"Through publicly available information, we have been able to ascertain that neither

Hutchison-Whampoa, nor its subsidiaries Hutchison Port Holdings (HPH) and the Panama Ports Company (PPC), have any significant investment from mainland China."

What isn't clear is how Gutierrez determined that, when many key companies in the group including Hutchison Port Holdings are registered in tax havens so their true ownership cannot be searched.

Investigate did finally get to put a series of questions to CCHL Chief Executive Bob Lineham. The questions, and his answers, are as follows:

1. How is CCHL satisfied that, even if Hutchison is a front company for the People's Liberation Army of China, that its majority stake in the operating company for the Port of Lyttelton remains a good idea?

Answer from Bob Lineham:

"In the event that Christchurch City Holdings Limited's (CCHL) Takeover Offer for Lyttelton Port Company Ltd (LPC) succeeded, and Hutchison Port Holdings Ltd was introduced into the Port of Lyttelton, the Christchurch City Council would retain control of the Lyttelton Port Company with a 50.1% voting majority (through CCHL) of the shares in LPC.

"The purpose of the new port operating company in which HPH would have a 50.1% share is to operate the Port of Lyttelton. It does not and cannot control the Lyttelton Port Company. With HPH as a port partner, the Port of Lyttelton would be controlled, as it is today, by the people of Christchurch through CCHL and the Christchurch City Council.

1. How is CCHL satisfied that Li Ka-shing is a legitimate businessman, in the face not only of his vast personal fortune in a socialist country, but also his well-documented ties to communist China and its ruling politburo long before the 1997 handover of Hong Kong? No answer received.
2. Why is it not strange that a communist state can be home to the world's tenth richest man, without corruption being a factor? No answer received.
3. In what way has CCHL consulted with the New Zealand government or its officials over the proposed buy in?

Answer from Bob Lineham:

"The introduction of Hutchison Port Holdings to the Port of Lyttelton would be subject to the usual regulatory consents that are required when an overseas company is involved."

1. Li Ka Shing or companies and individuals associated with him have been implicated in smuggling 2,000 AK 47 fully automatic military rifles into California, and shipping componentry for nuclear weapons to Iran. CITIC, a Chinese Government company that Li helped found and sits on the board of directors of, is building an aluminium smelter in Iran the product of which can be used in missile technology and the production of nuclear weapons. Why are the reputational issues surrounding Li Ka Shing not a concern to CCHL? No answer received.
2. Why is CCHL not concerned about the fact that Hutchison was prevented from purchasing telecommunications provider Global Crossing in 2003 because of concerns that he was a security threat to the US? No answer received.

And if the Christchurch port administrators are relying on assurances by Clinton administration officials that Li Ka-shing is not a security threat, they could be backing the wrong horse. Sadly, Investigate has reported before on how badly briefed New Zealand officials are on international intrigue. Former National Government Prime Minister Jenny Shipley was given a briefing by Foreign Affairs and Trade on visiting businessman James Riady in 1999 that read like this:

"The Lippo Group is one of Indonesia's largest conglomerates in terms of market capitalisation with estimates of value putting it at having US$11 billion in assets.

"The vision of its founder Mochtar Riady is to transcend the institutional limitations placed upon organisations run in the traditional overseas Chinese pattern and adopt a modern publicly owned and professionally managed pattern of business.

"Mochtar has formed alliances and joint venture partnerships with world class multinational corporations and has high calibre professional management staff working for him.

"The Lippo empire rose out of the success of the Lippo Bank. Unlike just about all other banks in Indonesia its founder Mochtar Riady tended to shun the Suharto connections that for other conglomerates in Indonesia were the keys to success.

"He avoided lending to politically connected groups or to state enterprises and instead built his business on legitimate retail and trade finance."

Yes, well. That's the New Zealand intelligence briefing, but while our diplomats were talking about how politically-neutral and non-crony like the Riadys were, the businessmen themselves were on the run from US justice for illegally laundering $4 million of illegal Chinese government donations to President Clinton's re-election fund.

The saddest part of that story was the information about the Riadys was in the public domain, just as the information on Li Ka-shing is, but New Zealand trade officials chose to ignore it or write it off as "conspiracy theory".

Interestingly, one report from a US Congressional team that visited Panama says "Li Ka-Shing is an investor in the Riady family's Hong Kong China Bank." It is this international game of join the dots that seems too hard for New Zealand officials to understand.

The Riadys were heavily involved with a company called China Resources Ltd, which is also a joint venture partner with Hutchison in the Panama canal. China Resources has long been known as a front for Chinese intelligence, but this too was completely missing from the intelligence briefing given to Shipley. Indeed, judging from their innocuous contents one would have to suspect the briefing was in fact prepared by Chinese intelligence!

"The Lippo Group has a strategic position in China and Hong Kong with substantial investments and relationships with powerful business and government people and organisations.

"It owns 49% of the Hong Kong Chinese Bank with the remaining 51% held by China Resources (Holdings) which is a wholly-owned enterprise of China's Ministry of Foreign Trade and Economic Cooperation."

So despite Christchurch's insistence that New Zealand authorities have it all in hand and that citizens can rest easy in their beds, Investigate is reminded of this news release about the previous Asian-investor golden boy James Riady, issued by the US Department of Justice in 2001:

JAMES RIADY PLEADS GUILTY WILL PAY LARGEST FINE IN CAMPAIGN FINANCE HISTORY FOR VIOLATING FEDERAL ELECTION LAW

WASHINGTON, D.C. - James Tjahaja Riady will pay a record $8.6 million in criminal fines and plead guilty to a felony charge of conspiring to defraud the United States by unlawfully reimbursing campaign donors with foreign corporate funds in violation of federal election law, the Justice Department's Campaign Financing Task Force and the United States Attorney in Los Angeles announced today.

In addition, LippoBank California, a California state-chartered bank affiliated with Lippo Group, will plead guilty to 86 misdemeanor counts charging its agents, Riady and John Huang, with making illegal foreign campaign contributions from 1988 through 1994.

As the world's largest port operator, there are sound economic reasons for Hutchison to operate New Zealand ports. But there appear to be equally sound political and strategic reasons as to why they should not. If the deals proceed, it could turn into yet another political bombshell for the Labour Government to work through, a government that is, itself, close to China.

Posted by Ian Wishart at 12:57 AM | Comments (0)

December 08, 2007

Police Minister duped by bent cop: July 07 issue

KING DUPED BY BENT COP
Major Embarrassment for Police Minister

When Investigate called for a Commission of Inquiry last month, former Dunedin cop Peter Gibbons sprang to the Government’s and Howard Broad’s rescue. But now IAN WISHART reveals damning new information about Gibbons and police corruption, in another special report that now implicates the ACC corporation in Dunedin police misconduct as the shockwaves spread

The political fallout from Investigate’s special report on police corruption is about to get a whole lot worse, with confirmation that Police Minister Annette King and Prime Minister Helen Clark staked their own reputations on the testimony of a man who now turns out to be a corrupt cop.

When Investigate’s major story broke last month, the news media were quickly introduced to former Dunedin police officer Peter Gibbons, who told reporters the Investigate story about widespread corruption was “rubbish”, and that police commissioner Howard Broad had not watched the infamous bestiality movie referred to in the article.
Gibbons – now a Dunedin private investigator – provided information to Police Minister Annette King urging her to name a rival private investigator, Wayne Idour, as the man who brought the bestiality movie to Howard Broad’s party in the 1980s.

Gibbons’ testimony created a media firestorm and was used in a massive political offensive to defame and discredit Idour and, by implication, Investigate magazine’s call for a Royal Commission of Inquiry into the NZ Police.

At the time, Investigate already had Gibbons in its sights as an alleged corrupt officer, but our inquiries had not been completed and cross-checked for accuracy. So, for a month, Investigate has stayed silent.

Now, however, we can reveal that Investigate views Peter James Gibbons as one of the more bent police officers we’ve come across, based on the evidence assembled here, an officer who not only appears to have committed perjury by lying to a judge in a court trial, but who has also been captured on audiotape justifying police corruption and privately endorsing a group of officers who chose to lie to an official inquiry. Gibbons has been accused in affidavits supplied to Investigate of behaviour including tipping off drug dealers in advance of police raids, and corruptly obtaining police search warrants from his police constable son-in-law to help him fulfill lucrative commercial contracts as a private investigator working for a major government organization.

The irony – that the government and Police National Headquarters brushed off the need for a Royal Commission by relying on the word of a bent cop – will become chillingly apparent over the next few pages. But first, a look at the substance of Gibbons’ spin campaign against Idour and Investigate.

The first most people really heard was National Radio’s Morning Report, when host Geoff Robinson interviewed Police Minister Annette King. Although Gibbons had been interviewed the previous day sticking up for Howard Broad, he had not gone as far publicly as the Police Minister was about to.

“Geoff, yesterday you had a man on your show who stood up for Howard Broad, who worked with him. I spoke to that man yesterday,” said King.

“He gave me the name of the person who took the film – it’s actually a film – to Howard Broad’s house. He gave me the name of the person, the same person, who played the film, and the same person is the person who’s been hawking the story around the news media.
“The person, on your show, and I’m quite sure if you were to ring him he would confirm this, is Mr Idour.
“I am told by the same man that was on your show that when Mr Idour played the film that most people walked out of the room in disgust. They didn’t want to see it, leaving Mr Idour with very few people but himself to watch it.”

That last comment alone should have been enough to sound warning bells in the ears of intelligent listeners – the idea that boozed-up police at a rugby fundraiser walked out rather than watch a porn film that included a bestiality scene with a chicken.

National Radio’s Robinson asked the Minister how Peter Gibbons had ended up sticking up for Broad.

“Mr Broad spoke with people that he’d known in Dunedin at the time to go over his memory of events,” replied King.

Acknowledging that his question might appear “cynical”, Geoff Robinson queried the sequence of events, saying, “Certainly the names [of police prepared to support Broad] were provided to us by Police HQ, which raises the question of whether there was some concerted campaign by Police –”

“I doubt whether Howard Broad would be involved in some sort of concerted campaign,” interjected King.

Increasingly, however, that’s how it is looking. And if Police National HQ introduced Peter Gibbons to the Minister of Police, then to all practical effect PNHQ set up their own Minister to take an embarrassing fall if the true facts about Gibbons ever emerged.
With Wayne Idour’s name publicly besmirched as a bestiality-purveyor by the Minister of Police on National Radio, the media went wild. Peter Gibbons appeared on radio and TV interviews, telling the same carefully-constructed story. Note how the wording is deliberately strong and rehearsed as if to underline his credibility as a witness:

“Wayne Idour played that movie, Wayne Idour put it on, Wayne Idour was watching it. That’s what I categorically remember. I and another person spoke to him about it. And I remember it very, very well,” Gibbons told 3 News.

Contrast his rock-solid memory, however, with his comments on National Radio’s Checkpoint programme:

“I can’t remember if it was a movie or a video, bearing in mind I can’t even remember which year it was. Wayne put that movie on, or video on, and when people saw what it was, they moved out of the room. What I can tell you Mary is myself and the Vice Captain of the team actually went and spoke to him and asked him to desist. He wanted to continue watching it and we told him he would have to watch it by himself. He watched it by himself. The party continued in another room.”

“Police Minister Annette King stands behind Gibbons,” continued the 3 News report as it led into a video clip of King:

“He told me directly, the person who brought the film to the party was Mr Idour. And Mr Idour played the film.”

It didn’t occur to many journalists that the likelihood of Wayne Idour tipping off the country’s most controversial magazine about the chicken film was nil, if he had in fact been the person who originally brought it along. After all, it was not a private screening but a party attended by about 100 men, many of them police officers.

Police Commissioner Howard Broad himself muddied the waters significantly by revealing that when he found out the movie was playing in his house, that he complained to Peter Gibbons and a fellow detective, Gordon Hunter, about it.

“I moaned about it because I just didn’t want that sort of thing being beamed onto the wall of my lounge,” Broad told the Herald.
According to Broad, and Gibbons, the party was a fundraiser for the police rugby club and the main attraction was movie reels (there were no videos in 1981) of “old Ranfurly Shield rugby games”.

One person who doesn’t buy that explanation for a nanosecond is Howard Broad’s former boss, retired Detective Sergeant Tom Lewis.
Speaking from Australia, Lewis has told Investigate that the idea of 100 police officers and their mates holding a fundraiser in 1981 by screening “old Ranfurly Shield games” on a projector is a fabrication.
Lewis says film footage of old Ranfurly Shield matches did not exist on home movie format in 1981, and the idea that 100 cops had gathered to watch a fellow policeman’s shaky home movie of an entire game is ludicrous.

He’s told Investigate he was aware of a number of similar fundraisers, and the drawcard was usually the latest pornographic movies seized by police. Like Wayne Idour, he says they were not functions normally attended by women.
He recalls on one occasion two of his junior staff, Gordon Hunter and Jim Stacey, discussing the porn movies they’d viewed at a police rugby fundraiser, and he says that may have been the one at Howard Broad’s house.

Lewis also scoffs at former Detective Peter Gibbons’ claim that everyone left the room when the movie came on.

“Is he expecting people to believe that a hundred people suddenly crammed into Howard Broad’s kitchen, and that Broad then asked Gibbons and Gordon Hunter to tell the one person in the lounge to turn the movie off, using his prime authority as the householder, but that the person in the lounge refused and neither Howard Broad nor Peter Gibbons did anything? That’s almost an even bigger indictment on their policing and decision making ability than watching the bestiality movie in the first place!”

It is also, says Lewis, impossible to believe.

The gullible Police Minister Annette King, however, fell for it hook, line and sinker.

“Mr Gibbons is well known in Dunedin, I’m told, highly respected. He is prepared to back what he said. I think it’s now up to who people believe and I personally believe Mr Gibbons.”

King wasted no time upping the ante, either. Under the cloak of Parliamentary privilege she launched a stinging attack on the credibility of Wayne Idour and Investigate magazine:

“The modus operandi of that magazine is to base a story on a half-truth, and from that to build an entire menu of fantasies. There was a party in Dunedin in 1981. There was an objectionable pornographic film shown at it. The basis for the story came from information provided about the party by an unknown person. Mr Wishart said that he did not identify the informant at the time, because the informant had a sick family member. When has Mr Wishart ever given a damn about the family members of his targets?”

For the record, Investigate has withheld information about some political figures from publication because of concern for their families, nor did we conduct a major investigation into how Police Minister Annette King’s daughter crashed a ministerial vehicle containing illegal drugs. Also, for the record, the “sick” family member King refers to was dying, and the Minister knew it when she chose only to call him “sick”. Investigate had issued a news release explaining that the man was terminally ill. For the record, Idour’s close relative died two days after Annette King’s callous attack in parliament.

“His informant was outed,” King continued in parliament, “and subsequently Wayne Idour has had to own up. That man was a former police officer in Dunedin. He is the same man who was employed by the Exclusive Brethren to dig up dirt on the Prime Minister and on Labour MPs and their families. He is a proven liar. Wayne Idour lied to TV3 about working for the Brethren, and I believe he is now lying again. I believe he is lying when he says he did not take the bestiality movie to the party. I believe he lied when he said he did not show the pornographic film. I believe he lied when he said he saw Howard Broad watching it.”

Again, for the record, Wayne Idour is arguably a “proven liar” only in regard to one event – distancing himself from the Exclusive Brethren. As a matter of historical fact, however, Idour was not hired by the Brethren but by an Auckland private investigator who did not disclose the identity of the clients to Idour until well down the path of the investigation. Nor was Idour employed to follow the Prime Minister or Peter Davis – another common error made by politicians and the media.

Peter Gibbons’ dishonesty, however, is far more serious and includes giving false testimony, on oath, to a court, as you will read shortly. The people who ultimately relied on “a proven liar” are the Minister of Police herself, and Prime Minister Helen Clark.
And it’s not as if Gibbons’ motives were not transparent to others.

“In my view Peter Gibbons has a vested interest,” Tom Lewis told Investigate. “He’s a close mate of Broad’s, and he also gets a lot of his private detective work from Dunedin Police. So it’s in Gibbons’ best interests to support the police on this.”

Gibbons’ relationship with Dunedin Police is, in literal fact, incestuous. Although Gibbons had to leave the force 10 years ago and set up in business as a private investigator, his daughter Melissa became a police officer and subsequently married another young cop named Andrew Henderson, who transferred to Dunedin.

Investigate stumbled across this relationship during a thorough search of Gibbons’ property transactions, which included a number of sales and purchases involving the AW and MA Henderson Family Trust, which Peter Gibbons is a trustee on. Recognising it as a family trust for his daughter and son-in-law, Investigate put those documents to one side as irrelevant, until a chance comment from Dunedin man Bruce Van Essen, who’s been battling ACC, suddenly made the Henderson Family Trust centrestage again.

Van Essen had posted comments on the ACCForums website about Peter Gibbons’ work as a private investigator for ACC, and when we contacted him he remarked how Gibbons would execute police search warrants on the homes of ACC claimants, even though he was no longer a police officer.

“We think the warrants are really dodgy,” Van Essen remarked. “He must have a mate inside the police doing it for him. Besides which, it’s always the same cops who turn up to do the searches with Gibbons.”

“Really?” the magazine asked. “Who?”

“It’s a Sergeant Kindly and a young constable named Andrew Henderson. Every time. And sometimes there’s another guy, Graeme Scott, who has now left the police force and is working for Gibbons.”

When Investigate obtained copies of the police search warrants used by Gibbons to raid homes of ACC victims and seize their property, we found a direct match between the signatures of Constable Andrew Henderson on the warrants, and the signatures of Andrew Henderson we already had on a string of property purchases with Peter Gibbons.

The fact that private investigator Peter Gibbons, whose business has a lucrative $172,000 contract with the government ACC agency, is using his son-in-law in the police to draft the search warrants he needs, appears, to Investigate, to be a massive conflict of interest, and further evidence of the need for a full Royal Commission of Inquiry into police corruption. (Read the documents here,10Mb PDF file)
But it gets worse. In an affidavit provided to Investigate for review by an eminent legal entity, Van Essen discloses that the police searches were conducted outside standard police operating procedure. For example, it has been common for the police presenting the warrants to play no part in the actual searches, and instead let civilian Peter Gibbons and his private assistants search through the houses with no police supervision at all.

“The cops actually turn their backs, they don’t watch,” confirms Van Essen to Investigate.

Under New Zealand law private investigators working for anyone, including ACC, have no legal authority to search anyone’s house, as powers of search and seizure are tightly regulated under ancient common law and the Bill of Rights Act, as well as the Police Act itself.

Section 6 of the Police Act specifically forbids any non-sworn (civilian) person carrying out any of the powers and duties of a sworn police officer without explicit written authority from Police Commissioner Howard Broad, and that written authority must be carried by the civilian at all times and presented to householders if requested, Gibbons had no such authority from his friend, Howard Broad.

Three Dunedin residents have sworn affidavits about Gibbons executing search warrants in the company of Graeme Scott and Constable Andrew Henderson, along with irregularities in the search warrants. On one occasion the ACC corporation replied to a complaint by blaming the irregularity – a reference to a false declaration – on a “cut and paste” error by a police typist.

Let’s take a closer look at that “cut and paste” error.
On a search warrant dated 31 August 2006, police are authorized to search premises occupied by Bruce Van Essen at a Dunedin primary school because:

“There is a reasonable ground for believing that there is (are) in any building, aircraft, ship, carriage, vehicle, box, receptacle, premises or place at Abbotsford Primary School, 72 North Taieri Road, Dunedin, the following thing(s), namely:

“…documentary evidence, however, held either manually or electronically stored including computer hard drives, bank statements, invoices [etc]..”

The chances of finding a jumbo jet or a ship in the playground at Abbotsford school were remote, but having identified the kind of things the police were to seek, the warrant had to specify on what grounds, in other words, what law was suspected of being broken that justified a search.

The warrant spelt out that the grounds against Van Essen were:

“…Upon or in respect of which an offence of Making a false statutory declaration using a document for pecuniary gain has been or is suspected of having been committed…

“Or which there is reasonable ground to believe will be evidence as to the commission of an offence of Making a false statutory declaration using a document for pecuniary gain…

“Or which there is a reasonable ground to believe is intended to be used for the purpose of committing an offence of [blank].”

In other words, the justification for the entire search warrant hinged on an allegation that Van Essen had made a false statutory declaration.

This was the warrant served by Gibbons’ son-in-law, Constable Andrew Henderson, who then allowed Gibbons – a civilian and private investigator working for private financial gain – to ransack Van Essen’s premises and rack-up billable hours to the government owned ACC. If anyone was using a document for pecuniary gain, it was Gibbons.

Documents obtained by Investigate and signed by Constable Henderson show the warrant was executed a week later, on 8 September 2006.
So where was this false statutory declaration to ACC that Van Essen had purportedly made, and which the search warrant was based on? It didn’t exist, and the ACC confirmed this in a series of letters earlier this year.

In a further letter dated 3 May this year, acting ACC CEO, Dr Keith McLea told Van Essen:

“You raise issues about the search warrant. I understand the police typist preparing the affidavit made a ‘cut and paste’ error in good faith and failed to remove a passage from a previous search warrant template. I am satisfied that this kind of minor error would not have affected the validity of the warrant.”

Really? Try removing the clauses about a statutory declaration above, and see what kind of grounds you are left with.

Van Essen also tried to get a copy of the affidavit supposed to have been filed in support of obtaining the search warrant. Such an affidavit would presumably have spelt out in detail the nature of the now non-existent statutory declaration. Within the police, the task of responding to the Official Information Act request seemed to bypass the official channels and land on the desk of Peter Gibbons son-in-law, Andrew Henderson, a mere constable. OIA requests are supposed to be processed by ranking officers.

“In response to your request for a copy of the affidavit supporting the application of a search warrant, this is declined…the matter is an ongoing investigation and the affidavit will not be released.”
Henderson is not the only Dunedin police officer in the frame for alleged misconduct.

Graeme Scott’s involvement may also be a breach of police regulations, and further evidence of the kind of corruption requiring a Commission of Inquiry. It is an absolute breach of police rules for any sworn police officer to be involved in private investigation work. But Investigate has obtained documents showing Detective Sergeant Scott was listed by the ACC as one of its investigators in September 2006. When Investigate called the Dunedin Central Police station and asked when Scott had left the police, the operator told us, “Detective Sergeant Scott left the police earlier this year [2007]”.

If true, that would put Scott, Gibbons, Dunedin Police and the ACC in the gun for a massive breach of police conduct.

But independent of Van Essen and the others, Investigate has discovered another case, where Gibbons allegedly impersonated a police officer, and failed to disclose he was working for the ACC.
“On 6th May 1998 I received a telephone call at my former employer BNZ from my husband, to say that the police were at the house and I had better come home,” Dunedin woman Kathryn Dawe told Investigate.

“On arriving home my [then] husband had been arrested and was being taken to the Dunedin Police station for questioning in relation to a large quantity of cannabis that was located in a room attached to the garage at 159 Ashmore Street.

“The police officers I recall seeing were Detective John Ferguson, Detective Greg Dunne and another unnamed officer. They were in the garage at the property. There was a fourth person (male).

“I was inside the lounge with our then 14 month old son and recall a tall male standing by the sliding door who started asking me questions. I asked him who he was and his words were, ‘My name is Peter Gibbons. I am a police officer and we have found a lot of drugs in your garage.’ He said he was with the Dunedin Police executing a search warrant.

“I asked to see the drugs and was told by the police officer, Peter Gibbons, that I knew what was in the garage. The officer I was speaking to (Gibbons), I describe as a tall, white male, fairly solidly built, about 5’10”-5’11”. He had brown hair and what I remember most was his moustache. It was light brown and curled up at the edges. Hair thinning on top. He was blunt to the point of rudeness,” says Dawe.

“I accepted that he was a member of the NZ police. I never asked for any identification from any of the officers and no identification was presented to me.

“Mr Gibbons asked me questions about our personal finances and was shown details of bank records, hire purchase payments, car payments, to offer him assistance with his inquiry.

“Mr Gibbons also requested the keys to my vehicle and as it was parked in the driveway he conducted a search in my vehicle. Mr Gibbons also searched the lounge and kitchen areas of my home.

“Peter Gibbons gave me the search warrant under the Misuse of Drugs Act when I left the property. The warrant was executed under the Misuse of Drugs Act and the Social Security Act 1964 and issued to the Dunedin Police Station. Gibbons was fully active in the search of my property while I was at home.”

Kathryn Dawe says she told her husband’s lawyer, Anne Stevens, about the obnoxious police officer but “could only recall his name being Peter”. The lawyer rang police who initially denied that any police officer named Peter was involved in the search and that the man Dawe spoke to was Detective Greg Dunne.

“It was later revealed through the [legal] disclosure process that the person speaking to me was in fact Peter Gibbons who was at the property on the request of ACC to investigate Craig [Harris, Dawe’s then husband] for ACC related matters.”

After being released from prison, Dawe then set about trying to get Gibbons’ private investigator’s licence revoked on the grounds that he had impersonated a police officer to obtain information that she would otherwise not have provided him with.

“I complained twice, possibly three times, 2001, 2002 and possibly 2003. In the end I gave up because Mr Gibbons had the support of two or three members (current and former) of the Dunedin CIB. The matter was not sent to a hearing and I was never able to verbally put my case forward.”

The complaints were made to the Registrar of Private Investigators and Security Guards in Auckland, but surprisingly no action was taken. Surprising, because the only grounds the Registrar has for avoiding a hearing, under s24 of the Private Investigators and Security Guards Act, is “if no notices of objections to the grant of the application have been filed”.

Section 66 of the Act specifically lays out that private investigators are not allowed to “either orally or in writing claim, suggest or imply that, by virtue of his licence, certificate of approval, occupation, or business, he has any power or authority that he does not in law have; or (b) Use or attempt to use his licence…for the purpose of exercising, claiming, suggesting or implying such a power or authority; or (c) Either orally or in writing describe or refer to himself as a detective or by any other expression or term containing the word ‘detective’; or (d) Wear any article of clothing, badge or other article that is likely to cause any member of the public to believe that the holder of the licence or certificate of approval is a member of the Police.”

When Investigate contacted the office of the Registrar of Private Investigators earlier this month, the file on Peter Gibbons was “missing”, according to office staff.

“Is that usual?” we asked.

“No, the file should be there,” the office manager confirmed. She added that a complaint has recently been received about Gibbons.

Peter Gibbons has had a long career in the police, entering in the early 70s and perfing in 1997 for reasons we are still investigating. He is well schooled in the fine arts of giving compelling evidence in court, and training younger cops what to say and what not to say.
Gibbons told NZPA last month that he was telling the truth about Wayne Idour being the man who brought the bestiality movie along.

“I wouldn’t have said that if I wasn’t prepared to swear an affidavit or go into any court in the land and say it.”

But there’s strong evidence that Gibbons is a man who is even prepared to lie in court, making his word utterly worthless.
In 1988 an undercover police officer using the name “Brent Stace” testified in the trial of an arrested man that the suspect (who we’ll call ‘John Doe’) had been a “target” for the police operation, codenamed “Sub Rosa”, even before it began in early February 1987.
Doe was a second hand dealer who owned a car wrecking yard in Dunedin. The city was undergoing a bit of a car theft epidemic in the mid 80s, and popular wisdom within some in the police was that John Doe must have had something to do with it. In fact, as the evidence you’ll read suggests, the real mastermind was a man named Bob Wood, who just happened to be a good friend of a popular Dunedin police officer. And it was Wood that police used to help set up John Doe. Wood would offer drugs and other items to targets, and ask them to onsell them to his mate, undercover cop Brent Stace.

“I was made aware of him [John Doe] at the beginning of the operation…the police were interested in him,” Stace told the court, on oath.

“Were you made aware,” asked the suspect’s lawyer, “that he had no previous criminal convictions?”

“No,” said Stace, “because I am sure he has got one.”

“So you have seen a list of his convictions?”

“Yes,” confirmed the undercover cop.

What’s interesting is that the 37 year old suspect, John Doe, had virtually no criminal record at all, just one conviction for a minor theft at the age of 17 – twenty years earlier – for which he received a $30 fine. That offence, in 1968, was the only record listed.

“At the beginning of the operation I saw some people’s criminal history,” Stace told the Court.

“Can you recall who showed you that?” challenged the lawyer.

“Detective Sergeant Peter Gibbons, my operator. He was the operator who briefed me.”

“At that time,” continued Doe’s lawyer, “were you given the accused’s name and address as a target?”

“Yes, I was. He was disclosed to me.”

That’s the sworn testimony of “Brent Stace” – now a Christchurch businessman using his real name – back in the Dunedin District Court in 1988.

But later in the same court transcript, here’s what Gibbons had to say under cross-examination:

“When Constable Stace commenced this operation did you provide him with a list of names?” asked the suspect’s lawyer.

“No.”

“Did you provide him with the accused’s name?”

“No. This accused was not a target at the commencement of the operation,” answered Gibbons on oath.

“When did he become a target?”

“When he offered to sell a firearm [on March 31st].”

Two men, both police officers, both with totally contradictory stories. Both giving evidence on oath. Nor is it a matter where faulty recollection is an issue. The trial was taking place less than a year after the arrest, and both police officers had had plenty of opportunity to get their stories straight. But the younger, less experienced Brent Stace was first up on the witness stand and let slip some crucial information. His recall of seeing the suspect’s prior conviction, and being made aware the man was a target, when Gibbons briefed him right at the start in early February 1987, is in stark contrast to Gibbons’ assertion that he did no such thing.

Why is it important? Because it is one thing to do an undercover operation as a fishing expedition. It is another to carry out what’s known as “entrapment”, where you attempt to set people up.

It also, of course, casts doubt on the credibility of either Peter Gibbons, or Detective Brent Stace. One of them was lying to the court, and therefore may still be prepared to lie on oath today.
If it was Brent Stace who lied on oath, then question marks now arise over his testimony that saw nearly 80 people prosecuted. Based on the evidence you are about to read in this story however, Investigate believes it is Peter Gibbons who lied on oath in the evidence given above.

Detective Gordon Hunter worked under Gibbons and is described in the court transcript as being “friends” with a criminal named Bob Wood.
Witness Pamela Philip was Wood’s de facto partner during this time and told the court they often met Hunter “on numerous occasions socially”.

“It was my understanding Bob Wood and Detective Hunter were friends.”
Philip testified on oath that she had been present in the Dunedin District Court in late 1986 when several criminal charges of receiving stolen property against Bob Wood were suddenly dropped.

“When it came time for [Bob] to take the stand, Gordon Hunter stood up and said the charges had been dropped. Gordon Hunter did this personally, he was in the courtroom.”

It was at that time that the plan for Operation Sub Rosa was being hatched, and Wood would play a substantial role in it. Police introduced Wood to their undercover detective, Brent Stace, although Stace went coy when asked in court to confirm how they met.

“Did you meet with him and any police officers directly?” questioned John Doe’s lawyer.

“I can’t answer that question,” said Stace, as the Crown lawyer stood up to object to the line of questioning.

“Did you ever meet with Detective Hunter and Mr Wood?” continued Doe’s lawyer.

“Objection!!” exclaimed the Crown lawyer again.

Regardless of how they met, it appears Detective Gordon Hunter was involved and that Wood was agreeing to help police set up a group of “targets” by introducing them to Brent Stace.

Wood’s motivation was twofold. Firstly, Gordon Hunter had dropped criminal charges that Wood was facing. And secondly, Stace’s role was to offer to purchase stolen property or drugs.

The fact that Wood was supposed to introduce Stace to targets of Operation Sub Rosa was acknowledged by Detective Sergeant Gibbons, who told the court, “Wood made introductions for Stace”.

Gibbons, as you’ve already seen, is on record as testifying on oath that John Doe was not a target until he offered to sell a gun on March 31st, eight weeks into the operation.

But look at the sworn evidence of Detective Gordon Hunter. Hunter told the court that Brent Stace made contact with Doe right at the start: “I am aware that the undercover officer met your client [John Doe] prior to any involvement with the person you refer to as Wood.”

If Doe was not a target, as Peter Gibbons claimed on oath, why did Stace make a beeline for him, as both Stace and Hunter acknowledged on oath. Gibbons’ evidence now appears to contradict not one, but two other police officers.

Nor was this the only case of lying on oath in that trial.
In a signed statement dated 27 January 1988 and obtained by Investigate, petty criminal Keith Kilner described a meeting at 15 Panmure Ave, Dunedin in August 1987, just after John Doe’s arrest. Kilner was meeting Bob Wood at the home of Wood’s new girlfriend, Sharee.

“This meeting with Bob Wood, which went on for about one hour, he (Bob Wood) offered me money and a way out for my court case. I had been arrested in Christchurch on five charges of receiving stolen goods.

“I asked Bob Wood what I would have to do.

“Bob said, ‘all you have to do is drive a truck load of Holden Commodore parts from Christchurch to Dunedin and deliver them to [John Doe’s] wrecking yard in Hope St and collect the money for the parts’.

“I asked Bob Wood why he had set me up with Bret (sic) Stace, the undercover cop.

“Bob Wood told me that he had to set me up because he was working for the police and that my name (Keith Kilner) was on a hit list of people that the police wanted busted and put behind bars.”
When Kilner asked who, within the police, Wood was working for, the latter responded:

“Detective Gordon Hunter”.

Wood explained he’d been working for Hunter “for a long time” because the Detective had him “cold on a lot of charges” and could have him in jail for a long time if he refused to cooperate.

“Bob Wood stated that Gordon Hunter said he would lose all the paperwork on those charges and all that he (Bob Wood) would have to do is set up these people on this CIB hit list and drive around with an undercover cop and introduce him as his friend Bret Stace from Auckland.

“Bob Wood told me that he had to get these people on this hit list and other people he knew to commit crimes and sell the goods to Bret Stace because that is what Hunter wanted. I asked Bob Wood what the hell’s all this got to do with [John Doe]?

“Bob Wood stated that [John Doe’s] name is on that CIB hit list and Gordon Hunter wants him real bad.”

According to Kilner’s statement, Wood confessed to setting Doe up on several occasions, most recently when he brought Doe a .38 revolver with a broken firing pin and asked him to fix it in his workshop, as well as four bags of cannabis. Wood wanted Doe to sell the lot to Brent Stace for cash.

“I asked Bob Wood who got the cash from the sale of the gun and the drugs,” says Kilner, and “Bob…told me that he (Wood) got all the cash.”

Kilner also asked where the gun and ammunition came from.

“Bob Wood told me that he had been given the gun and ammo by Gordon Hunter.”

In other words, Dunedin Police supplied a handgun to a criminal whose firearms licence had already been revoked, as part of a plan to entrap John Doe.

Kilner began to express some major reservations with Wood’s new plan to have him drive a load of Commodore parts to John Doe’s wrecking yard, saying in his statement, “I wasn’t very happy with the way this is starting to shape up.” Kilner demanded to know the origin of the Holden parts and Wood soon admitted they had come from Commodores stolen in and around Christchurch.

“I then told Bob Wood that know (sic) way am I going to bring those hot car parts into Dunedin, you are just going to set me up again. The cops would just love that.

“Bob Wood said, ‘don’t panic, I will ring Gordon Hunter and get him over here now. That way we can get Hunter to sort out your receiving charges and we can tell Hunter about you bringing those hot Commodore parts down from Christchurch’.”

Kilner told Wood he would “have to think about this”, to which Wood replied:

“Hunter doesn’t give a s**t about what I do or what laws I break as long as I set up who he wants to arrest, and he wants to put [John Doe] out of business and behind bars…so come on, give me a hand to set up [Doe] and Hunter will pull your five receiving charges and earn yourself some real easy money.”

Investigate has spoken to another of Wood’s onetime girlfriends, and she clearly remembers both Peter Gibbons and Gordon Hunter being involved with Bob Wood.

“I had met with Peter Gibbons, yeah. Gordon Hunter mainly. Peter Gibbons was just every now and again. Bob’s and Gordon Hunter’s relationship was close, they were good friends.”

Gibbons was officially Hunter’s boss. He was also running undercover cop Brent Stace. Hunter meanwhile, was running Wood. Wood supplied the bags of dope to John Doe to onsell to Brent Stace.

“The dope was stored in my cupboard until he grabbed it one day and did what he had to do with it,” remembers the former girlfriend.

One of the stories that has constantly come up from former members of the criminal fraternity (after being busted in the 80s most went on to live upwardly mobile respectable lives) is that Bob Wood was stealing cars on the instructions of Gordon Hunter, and splitting the profits.

“Wood had this arrangement where he got his boys to nick cars and store them in various garages around the city, and roughly once a week Hunter would check which cars,” one former associate of Wood’s told Investigate. “Those vehicles that were insured would be ‘found’ by police and returned via a tame insurance agent Hunter had in exchange for a finder’s fee of roughly 10%. Hunter and his insurance mate split the difference, while Bob Wood was then allowed to wreck and strip any of the stolen vehicles that didn’t have insurance company interest. So the cops were happy, the insurance agent was happy, and Bob was happy.”

There is strong speculation that the Operation Sub-Rosa decision to target car wrecker John Doe was part of a stunt to take the heat off the ‘police’ car theft ring run by Wood.
Wood’s former girlfriend agrees.

“They thought that [John] was the big guy, but I was led to believe that Bob was the big guy. Bob was the one with the briefcase with all the master keys for all the cars, he was the one that organized which cars to steal, and he sent the goonies out to get them. They came back laughing about things like, ‘Oh, that guy was sitting in his front room reading his newspaper and we just pushed the car down the street and cranked it up.’

“Then they would just wheel them into the garage, take the dog tags as they were then, and change the number plates, engine plates, sometimes spraypaint it or change a few panels here and there, then out it would go. And it was already basically pre-sold. I think they even drove them up to Christchurch to get rid of them.”
None of which, incidentally, involved John Doe.

“Then of course we were involved with the undercover police,” the girlfriend continues. “Bob initially didn’t want to tell me he was involved in an operation. He was ‘trying’ to tell me, but he wasn’t telling me. This big, big operation. So he told me to watch Scarface with Al Pacino! That’s how he saw himself!

“Anyway, Bob was skiting about that and I wasn’t to say anything to anyone. But the guy that came into our midst was Brent Stace.

“Brent came in, I already knew who he was and I was told just to act normal, that he would be mingling with us, and he would be doing everything that everybody done, like pot smoking. I wasn’t into it and I don’t think a lot of them were, but he had to carry on like that.

“Hunter and Stace took Bob to Christchurch Airport to get him out of there. When they first busted them he had to spend a night in jail, and he was offered immunity at that stage in return for squealing on everybody.”

But the number of people linking Detective Gordon Hunter to Wood and a deliberate campaign to “set up” John Doe doesn’t stop there.
A trailer was stolen from Doe’s premises by a man named Vincent Singh. The trailer was later miraculously found at Singh’s residence by Detective Gordon Hunter, but Singh was never charged. Singh stole the trailer for revenge – Hunter had earlier told him that Doe had stolen Singh’s car (Doe says Hunter was simply playing both men off against each other by lying to Singh, and certainly there’s no record of Doe ever being charged). So Singh had no particular love for John Doe, and even a kind of enmity, which is why this next piece of evidence is relevant.

Hunter left a message in August 1987 for Singh to get hold of him. This fact is not disputed, and was admitted in court. What Hunter didn’t realize is that when Singh went to see the detective, he was carrying a hidden tape recorder which captured their conversation verbatim.

On the tape, Singh asks Hunter, “Why wasn’t I charged with it?”

“Well, that’s something that we have to work out,” says Hunter.

Sensing that the threat of prosecution may still be hanging over his head, Singh asks what Hunter wants, and Hunter begins discussing John Doe.

“He’s the worst, he’d be the worst one of the whole lot…but he just hasn’t got the convictions.”

Ignoring the obvious point – that Doe may not have convictions because he may not be involved – Hunter then starts discussing what police now had on Doe:

“Somehow or another he got a whole lot of bloody grass, cause we got it all in an exhibit and we got a photograph of it, same time he had sold a bloody shooter, plus a whole lot of ammunition, and it’s a real one because I bloody test-fired the bloody thing, it goes, it’s as good as the bloody rod I carry around!”

The last statement is important, because on the tape Hunter has just admitted firing the gun sold by John Doe.

Now contrast what you’ve just read with what Hunter swore on oath in court:

“The subject of that conversation was a comical situation that I treated as a complete nonsense…in the course of that conversation I don’t recall saying to Singh that I had fired the gun…and I certainly have not fired any gun that relates to your client.”

Conflict of evidence? On tape Hunter says he fired it. In court, Hunter denies it.

Peter Gibbons, likewise, testified on oath that Gordon Hunter never fired the gun.

Back on the tape meanwhile, Vincent Singh treats Gordon Hunter’s claims about John Doe dealing drugs very skeptically:

“As you know, most people that get around in that sort of circle know what everybody else is doing. Now, I know that [John] doesn’t deal in drugs. I’m damn sure he doesn’t!” exclaimed Singh.

“Well I’m telling you he does,” retorted Hunter. “Someone who’s running guns and selling dope –”

“[John]’s not, no, [John] doesn’t deal in that stuff,” countered Singh.

“Well, what the hell’s he doing selling it?” said the police officer.

“I don’t know. He, the way I look at it, he’s been set up on that…as I said, I’ve known [John] for a while, even though we haven’t seen eye to eye, we still don’t,” said Singh. “You want to get him behind bars?”

“Yeah.”

“Right, you’re out to get him –”

“He’s got to go,” said Hunter, referring to the need to put Doe’s wrecking yard out of business. “You see, the thing is, well, if you haven’t got somebody into dealing with all the stolen goods or parts of whatever, right, there’s no motive for the thief to bloody go out and do the business, is there? …I know that he’s going to make a mistake…he’s got to go.

“I know he’s, well, he’s the rat in the trap. Like, you [Singh] haven’t been arrested in this operation and all the rest of it.”

“Yeah,” agreed Singh.

“He’s the rat that’s in the trap…and I’ll get him when he does something wrong, that’s the long and the short of it.”

Hunter then refers back to the fact he has not charged Singh with stealing the trailer, and how the “balance sheet” needs adjustment.

“Now, if I do the business [and] whoever I’m doing the business with gets the result I always pay my way. At the moment, the old balance sheet’s a wee bit round the wrong way as far as you and I are concerned,” Hunter warned Singh.

“Because you know that I’ve enough for you to be in Paparoa [prison], but what you don’t know is why.”

Hunter invited Singh to get back in contact the following week with any ideas on how Singh could help nail John Doe.

“I’ll come to wherever you are, and we’ll have a yarn and I’ll write stuff down.”

“Yeah.”

“And at the end of the day you’ll get your reward, then that will be the end of it,” said Hunter.

“Right, and you can see the man behind bars that you want to see behind bars,” replied Singh.

“That’s what the job is, isn’t it,” said Hunter.

The contents of the tape are damning when placed against Hunter’s willingness to lie on oath himself. For example, Hunter tried to tell the court that Singh was volunteering to plant drugs on John Doe:

“The man was making references to having drugs planted on this man [Doe] and I would never have anything to do with that type of conduct.”

“Are you saying Detective that this man Singh approached you and made references as to how he would plant drugs on [Doe] with police connivance?” asked Doe’s lawyer.

“That is what I say is nonsense,” confirmed Hunter on oath.

“Mr Singh came in and talked about how he would plant drugs on Mr [Doe]?” continued Doe’s lawyer, who of course had heard the secret tape recording and knew there was nothing of the kind on it.

“That is the type of nonsense that was being said,” agreed Detective Gordon Hunter.

So now there appear to be at least two “respected” Dunedin police officers who didn’t bat an eyelid about committing perjury in court.

“Were you aware that Mr Singh had some kind of recording device when he spoke to you?” asked Doe’s lawyer, probably with a wry smile.

“No, certainly not!” exclaimed Hunter.

Hunter was also questioned about the claims that he himself had supplied the cannabis to Bob Wood so that Wood could set up John Doe to sell it on Wood’ behalf to undercover cop Brent Stace.

“What would you do,” asked Doe’s lawyer, “if you heard that a police officer had supplied drugs to a civilian or a criminal person for whatever reason, a brother officer had supplied cannabis to a member of the public?”

“Depending on the amount of the drug would depend on the section [of the Act] I charged the police officer when we went to the charge room after I arrested him.”

“What about a police officer supplying a revolver to a member of the public?”

“The same rule would apply,” confirmed Hunter righteously. Possession of a pistol is an imprisonable offence and to supply that would make that person liable for conviction.”

Yet here are two police officers, Gordon Hunter running Bob Wood, and Peter Gibbons running Brent Stace. Wood miraculously obtains a gun and four bags of cannabis from somewhere, asks John Doe to fix the gun and sell it and the drugs on his behalf to Stace, the agent being run by Peter Gibbons. The court record clearly shows that Wood and Stace were working as a tag team, and the hidden tape recording and witness statements clearly show Gordon Hunter wanted to nail John Doe. Detective Brent Stace confirmed on oath he’d been asked by Peter Gibbons to target John Doe right at the beginning of the operation, while Peter Gibbons – in Investigate’s view – committed the worst form of lying possible: perjury in front of a judge. Forget lying to TV3 about the Exclusive Brethren – Wayne Idour’s supposed crime. Lying on oath in court is the ultimate taboo, the sign of a person whose word can never be trusted on any occasion.

And Peter Gibbons, readers will recall, is the Dunedin private investigator who urged Police Minister Annette King to wrongly name rival Dunedin private investigator Wayne Idour as the man who brought a bestiality movie to Police Commissioner Howard Broad’s party.

Investigate is aware of threats that as many as 40 former and current Dunedin police officers “are prepared to swear affidavits” contradicting what the magazine has published and that Idour was the source of the bestiality movie.

Given what Investigate has now uncovered involving the willingness of police to lie on oath, any affidavits sworn by any current or former Dunedin police are probably worthless in the public eye.

And just to reinforce the lack of police credibility on any of this now, Investigate is releasing portions of a taped conversation between Peter Gibbons and former undercover officer Peter Williamson, whose story later featured in the book Stoned on Duty by Bruce Ansley.

The two men were discussing an internal inquiry into the police undercover programme by senior police officer Bruce Scott in 1993. As the man tasked with training undercover cops in the South Island, Peter Gibbons could be considered an expert on the topic. On the subject of lying to cover your backside, Detective Senior Sergeant Peter Gibbons is heard justifying the actions of police officers who lied to an official inquiry:

“What you have to then accept is that when those guys got interviewed, their jobs, or they would have perceived their jobs and so on were at stake, so they would not tell the truth when they got interviewed by Scott.”

On the subject of stealing official documents, Gibbons admits on tape trying to induce a Police National Headquarters worker to send him an advance copy of the Scott report, even though PNHQ had expressly forbidden Gibbons from seeing it:

“I rung Helen, because Helen has done wee jobs for me for years, and I thought I’d slip a copy through the back door and get a look at this thing you see, so I rang Helen and said, ‘Look, don’t tell anyone, just get me this report and send one down to me’. Well, she must have been ferreting around and someone must have seen her and she got the big handsmack and got told, ‘he is not to get that report!’

“So she was told, you do not send that down to Gibbons!”

Further on in the tape, undercover agent Williamson criticizes a senior police figure:

“I suspect he’s not an honest man, I suspect he is manipulating this inquiry in the interests of the department.”

“Well that’s what they’re all going to do,” admits Peter Gibbons, “that’s what you have to accept.”

“I call that corruption, that’s what,” protests Peter Williamson.

“Well,” continues Gibbons, “the bottom line is this, and I would say that no matter who runs it…that’s always going to be the end result: the department will look after the department first.”

“Well I consider people, undercover agents, more important than the department,” counters Williamson. “I’m not so naïve as to think that the department can run without any form of corruption Peter, I’m not so naïve as to think that, but when the casualties of that corruption are directly related to cops f***ing up then, I’m, I cannot sit back and accept it unfortunately.”

Then follows a priceless line from Peter Gibbons:

“…I’m ingrained into the system and can’t see it from an outside perspective, but the bottom line as I see it is the department is always going to whitewash the department.”

Classic. “The department is always going to whitewash the department”. And this from the man who last month told Police Minister Annette King there was no need for an inquiry into Dunedin Police and Investigate’s “laughable” allegations:

“The general public shouldn’t be asked to believe that sort of stuff. The call should not be for an inquiry into police conduct in the Dunedin CIB in the 1980s because you get some [person] saying that.”
So that’s Peter Gibbons’ view.

On the other hand, Investigate has been collecting affidavits of its own on behalf of an eminent legal figure who will review our evidence in favour of a Commission of Inquiry. One of those affidavits is from a contractor who worked on a home belonging to the sister of Peter Gibbons when she lived at 17 Slant Street in Carey’s Bay, just north of Dunedin in the early 1980s. Other residents of the house included Peter Gibbons’ brother.

“I became aware very quickly that drugs were a feature in this house,” says our witness in a sworn affidavit, “as the occupants offered me marijuana and speed called Benzedrine. I declined the offer. I still remember the smell of the house and it stunk of marijuana. They mainly smoked joints. I noticed that their eyes were dilated most of the time.

“There was a flurry of activity and cleaning one day when I went out there in the morning…[Peter Gibbons’ sister] said that her brother, Peter Gibbons, had phoned to say the Police were going to raid the house for drugs. The Police subsequently came and searched the house…the afternoon of the same day that Peter Gibbons phoned, and the Police did not find any of the drugs.

“[Peter Gibbons’ sister] stated to me on several occasions that Peter Gibbons would phone her and pre-warn her if the Police were going to raid the house for drugs. She told me that Peter Gibbons saved their arse on a number of occasions.

“[The siblings] made comments that it was helpful having a brother on the Police force to keep them out of trouble.”
Remember, this is the same Peter Gibbons running Operation Sub Rosa, and the same Peter Gibbons being relied on by Police National Headquarters and Prime Minister Helen Clark to discredit Investigate’s story last month and our call for a Royal Commission of Inquiry into the police.

It is worth noting that Gibbons’ brother Tony was a pro-marijuana reform advocate.

The affidavit continues:

“I saw Peter Gibbons brother on a number of occasions deal drugs to people outside and inside of the house. They would arrive at the house and I saw money and drugs change hands. I also dropped Peter Gibbons’ brother into town one day, he told me that he was going to sell marijuana to people who were attending a function.”

The magazine has confirmed that the house at 17 Slant St was indeed a drug house, and a former associate of the Gibbons family has also noted that on the one occasion police arrested and charged Peter Gibbons’ sister on drugs offences some years later, an error in the paperwork resulted in the charges being withdrawn. The same associate, now a respected citizen, also recalls Tony Gibbons discussing Benzedrine, the early form of speed mentioned by our first informant.

Among others we spoke to was another underworld figure, now a businessman, who is prepared to testify to a Royal Commission of Inquiry that police “shorted” drugs seized as evidence, criminal slang for a procedure where corrupt cops seize drugs and either don’t enter it into the record at all, or otherwise remove a quantity of drugs from the deal bags before they are submitted and weighed as evidential exhibits.

The drugs are then sold by underworld figures like Bob Wood, controlled by police, with profits split between police and the drug dealer.

“I wasn’t any angel myself back then,” the businessman, Michael*, told Investigate, “but there were the likes of people being busted for marijuana, and like I went up to court myself – I got caught with 13 ounces and I got charged with 10. There was a lot of that going on.”

Who was the arresting officer?

“It was a cop called Peter Gibbons,” Michael said.

What happened to the missing three ounces of dope?

“It was put back out for supply,” says Jack*, another former drug dealer turned businessman who saw a large amount of his seized marijuana vanish without trace between arrest and the typing up of the charge sheet. “The cops had their networks, people they used, and they made a fortune from seizing drugs and reselling them.”

“They had their hands out all the time,” Michael confirmed to Investigate. “I know people who were pulled up with heaps and heaps of drugs but they just left them alone if you fixed them up.

“They’d take all your money, or drugs, whatever, then say ‘don’t let us see you out here again’, but you’d never be charged. That happened to me quite a lot. I got picked up a few times with amounts of pot on me and they’d just take the weed and say ‘I won’t see you again tonight’.”

According to Michael, senior Dunedin Police were running a protection racket where drug dealers would be left alone provided they paid substantial money to certain police officers.

“There was people getting paid under the table. [Name deleted] was a bit of a drug dealer back then but the cops never went around to see him. I was working in with him as well and we never got touched hardly, then this Peter Gibbons would come in.

“I was probably making three or four thousand dollars a week selling drugs and stuff like that, and because they weren’t getting anything out of it they were coming around and just ripping people off,” recalls Michael.

Furious at being set up during Operation Sub Rosa, John Doe went to the trouble of doing a little research on Gordon Hunter. He hired his own private investigator, who did an asset search and found the detective owned substantially more property and assets than his meager police salary would appear to support.

“Hunter and Gibbons also had accounts at the same bank in South Dunedin, where I banked. One of the staff members there showed me printouts one day. On the statements I saw, Hunter was taking in thousands of dollars a week. The bank executive made the comment to me that Hunter’s incomings far exceeded an ordinary detective’s wages,” says Doe.

Which tallies with information provided to us by Bob Wood’s former girlfriend, who has also sworn an affidavit.

“I remember I had to go away and drop money off to Gordon Hunter, but I don’t remember why. I had to take money out of an account and give it to Gordon Hunter in cash. It was $1500. I had to meet him, in one of the D cars. He came and met me at Lookout Point, and I was to just park there and sit and wait by the Fire Station, and I can’t remember if I was the one to get out of my car or not. I was given all these instructions, do this, do that, do this, do that. And I had to do it in cash, out of the Westpac branch in South Dunedin. It was a lot of money. It was to be gotten in littler bills, not hundreds. It was a big wad of money.”

To give Hunter the benefit of the doubt, perhaps there was an innocent explanation for the city’s top car thief paying a police officer $1,500 in small bills at a remote location. But it’s hard to think what kind of explanation that might be.

Nor is it the only question mark hanging over Hunter’s conduct. When a central city jewelry store was raided in a smash and grab in the late seventies, a friend of the jeweler’s saw Detective Hunter bend down and scoop up rings that had been scattered on the pavement. The raiders made off with around $90,000 worth of jewelry, but although some was later recovered and some of the offenders caught, mysteriously Gordon Hunter did not return the rings he’d picked up.

The jeweler, who’d been advised by his friend of Hunter’s actions, was later stunned when a local criminal offered to “return” the items for a substantial reward.

For the record, standard police procedure at the time was to cordon off crime scenes, impose a police scene guard, and wait for the police photographer to arrive and photograph the rings where they’d fallen on the pavement, for evidential purposes. Additionally, where some of the rings may have been clutched in an offender’s hand, there was always the possibility of fingerprints. Gordon Hunter’s actions precluded that.

But it wasn’t just Hunter.

“They all had their fingers in the pie,” says Michael. “They’re all pretty well off. They were worse than what we were, they were absolute backstabbing pricks.”

Michael also recalls the police earning cash from insurance companies for retrieving stolen vehicles.

“Sometimes they were like bounty hunters. I stole a motorcycle one time and you’d think it was a Rolls Royce I’d actually pinched. They had cops out for it everywhere, and they were looking for the reward.

“Something went missing, the freezing works got their export meat pinched, there was a joker in there doing that, but they ended up getting onto that but the cops ended up taking all the meat home. None of the meat got returned, but they ended up getting something for catching him.”

While admittedly some of these events date back to the eighties and nineties, the evidence and affidavits compiled by Investigate for independent review suggest the corruption was widespread, and part of the overall Dunedin Police culture. Many of the junior staff at the time are in more senior positions nationwide today and, as one ex-Christchurch officer told Investigate, “Leopards don’t change their spots”.

There is one final mystery Investigate has been able to solve – the identity of the police officer who was obtaining hardcore pornographic movies for the police rugby functions. The officer was a good friend of Peter Gibbons and a member of the police rugby club, which may be why Gibbons was prepared to lie about Wayne Idour supplying movies.

“I know that [the police officer] was going up to [a drug dealer]’s place and getting blue movies and stuff like that. Very early 80s.I was working with [a drug dealer] at the time,” says Michael, and [the police officer] used to turn up and I thought, ‘this is a bit odd, this is a bit weird’ because here was some cop dropping off movies and picking up new movies, and they were all banned ones.”

For the sake of the officer’s family and children, Investigate chooses not to name him. He is named, however, in the documents prepared for independent legal review.

Of course, Gibbons’ claim already had credibility running against it. As previously pointed out, if Idour were truly the source of the bestiality movie he had nothing to gain and everything to lose by mentioning the incident to Investigate. Yet Peter Gibbons was insistent to the point of overacting:

“Wayne Idour played that movie, Wayne Idour put it on, Wayne Idour was watching it. That’s what I categorically remember. I and another person spoke to him about it. And I remember it very, very well,” Gibbons told 3 News.

“I personally believe Mr Gibbons,” Police Minister Annette King chimed in, before deliberately vilifying an innocent Wayne Idour.

Like an episode of the cartoon show Roadrunner, however, the ground has fallen away beneath Gibbons with these latest revelations, and with them the credibility of the Government’s opposition to a Commission of Inquiry.

Howard Broad’s chickens have well and truly come home to roost.
Anyone wanting to add further information to our investigation can email our international email address: confidential(at)investigatemagazine.tv

Posted by Ian Wishart at 01:31 PM | Comments (0)

November 10, 2007

Another cabinet minister embroiled in immigration scandal

The Government is battening down the hatches tonight as another senior cabinet minister finds himself embroiled in an immigration scandal.

David Cunliffe, who held the Immigration portfolio up until last week’s cabinet reshuffle, is alleged to have contracted a cleaning company that used illegal immigrants to clean both his own house and his sister’s house in Auckland.

Investigate magazine has been given an affidavit by an Auckland man whose girlfriend, a 28 year old Mongolian woman, was one of the illegal workers employed by the VIP Home Services franchisor and who cleaned the Cunliffe family houses.

In the affidavit, Chris Flavell alleges his girlfriend Uulna was paid cash, with no tax deductions, but that her applications for a work permit kept getting knocked back by NZ Immigration Service.

Flavell has told Investigate that there is no suggestion the Minister realized his cheap house cleaning was being provided by illegal immigrants, but he nonetheless decided to approach the Minister on Friday to see if he could help find out why Immigration kept rejecting work permit applications.

“My girlfriend is a hard worker,” he told Investigate. “She doesn’t like working under the table and wants to make a positive contribution.

Flavell’s affidavit alleges that he left a message for the Minister on Friday, and that the Minister immediately rang back.

During the discussion Flavell explained that he had already contacted Investigate magazine and TV3’s Campbell Live, to which the Minister allegedly replied, “Whatever your problems are, I can’t help you under threat.”

“I’m not threatening you sir, I am just desperate for help,” replied Flavell.

According to Flavell’s affidavit, Cunliffe then said, “Go to my electorate office right now and speak to my secretary. They will take all the information from you and if something can be done, if we can help you, then we will. But I cannot act under duress. Go straight to the office right now, take all your information down there, give it to the secretary, she’ll be waiting for you, and we’ll take matters from there.”

Flavell alleges that when he got there, he was asked to provide as much information as possible, copying off documents from his laptop onto a CD for the Minister.

When Flavell told the office about his earlier contact with Investigate magazine and TV3, he quotes Cunliffe’s electorate secretary Lusi Schwenke as saying:

“Chris, if you go down that road and follow that path the media will destroy you, they will destroy the girl you love and the people who work in that VIP company. David cannot be harmed, he has a wall of protection around him.

“We will make a very serious investigation into these matters…we will contact Immigration immediately and intercept Uulna’s 35A application and check that it has been processed correctly…You don’t need to harm David, because that will only hurt Uulna and the people that she works with, and ultimately it will hurt you. You know what the media are like, they will make this into a monster. In Samoa we have a saying, ‘if you sharpen a spear to point at someone, the spear will harm you first. Don’t speak to Ian Wishart. Go home and calm down, and I promise you we will seriously investigate everything and nothing bad will happen to Uulna. Immigration is not going to come and pick her up, no one is going to come and harm you. Be calm, and let us do the job of investigating this.”

Confident that the Minister would indeed hand the case over to Immigration for review “immediately”, Flavell says he left the office in better spirits, but was stunned to find out that within 10 minutes the Minister had phoned the cleaning company and cancelled his contracts with them, on the basis of what Flavell had handed over for official review. According to the affidavit, Uulna was in the car with her boss when the Minister phoned, and she was fired on the spot.

Flavell is incensed that information he provided to the Minister for a proper review was allegedly misused by the Minister to “protect his own position” personally.

“I believe the actions of the Minister’s office, after telling me they would carefully investigate and that no harm would come to Uulna in the interim, were deceptive, , and that the Minister took immediate action to protect his own position without first attempting to make any proper investigation at all,” Flavell alleges in his affidavit.

“It was my belief that the proper course of action for the Minister would have been to immediately contact his officials and declare his interest in the case, so that the Service could commence a proper inquiry and Uulna’s circumstances could be reviewed as promised. Instead, the Minister’s precipitate actions have deprived Uulna of any natural justice at all.”

When Investigate contacted a spokesman for the Minister, he initially claimed that Uulna had never worked on Cunliffe’s house. When we challenged this claim, the spokesman said the Minister had been assured by the cleaning company owner, who had records that could prove Uulna was not on the roster.

When we pointed out that Investigate had a sworn affidavit to the contrary, the Minister changed his position to say that he would not comment on Immigration matters or become involved in them.

We asked his spokesman why, then, the Minister had acted on information provided in order to secure his personal position on this particular immigration matter.

“All I can say is that the Minister has no further comment,” said the spokesman.

Investigate rang Josip Trogrlic, the cleaning franchisor, who denied that Uulna had ever been an employee of his company or that she had ever set foot in the Immigration Minister’s house – a statement that matched David Cunliffe’s initial response.

Just a couple of minutes after our conversation with Trogrlic, however, Investigate was rung by Flavell with Uulna beside him in tears, she told Investigate that Trogrlic had just rung asking her to swear a false affidavit, testifying that she had never worked for VIP and never been in the Immigration Minister’s house.

Such an affidavit could have been used against Investigate magazine by either the company or the Minister.

Investigate phoned back Trogrlic to remind the cleaning franchisor that any attempt to procure a false affidavit could be deemed a conspiracy to pervert the course of justice, a crime punishable by up to seven years’ imprisonment.

“I have nothing more to say,” Trogrlic told the magazine tonight.

The Minister’s position appears to be precarious. While no one could fault the Minister for the fact that his cleaning contractor was using illegal workers apparently without his knowledge, the way that the Minister handled the matter when it came to his attention on Friday is questionable in Investigate’s view.

He used information provided to his electorate office to immediately secure his personal and business position, in such a way that it immediately impacted negatively on the constituent at the centre of it. This was despite a promise from his staff that the first step would be to “contact Immigration immediately”.

Additionally, the Minister acted unilaterally to cancel cleaning contracts with VIP Home Services, without any independent investigation or verification of Flavell’s claims by the Immigration Service – which again contradicts his statement that he does not comment or get involved in immigration matters.

Posted by Ian Wishart at 10:36 PM | Comments (0)

July 29, 2007

Keynglish, Part 1

THE JOHN KEY INTERVIEW

They say New Zealand politicians can’t be bought, but tell that to the person who, just before Christmas, shelled out more than $4,000 to have lunch with new National Party leader John Key after a charity auction on the Zillion website. All we can tell you is the mystery buyer wasn’t us. Instead, IAN WISHART caught up with John Key and his deputy Bill English for their most in-depth media interview yet on their vision for New Zealand.

JOHN KEY

KEY: My view is that this brand is in incredibly strong shape, these are values and principles that go back 70 years. And if you really look at the sort of things that, say, for instance Holyoake was saying and you apply them to what I've been saying in the last three weeks, then I think you'll find there's a pretty strong match there. I think the reason that the party has endured for so long is that those values are very very durable. Now of course individual policies come and go, what worked for Holyoake and others won't necessarily work for me in terms of absolute policies, because the environment is different, but I think one of the aims of that speech is to really spell out that while I've used a slightly softer tone in the last few weeks, than maybe Don did, that fundamentally we are still going in exactly the same direction with values that line up with where we think New Zealand is heading.

INVESTIGATE: It's been an interesting time in politics, particularly since Labour took over in 1999, and I guess the period up to the 2002 election, where it had its vicious electoral defeat was marked, I think, by National still trying to establish what it actually stood for. Is there a danger in the slightly softer tone that the clear delineation between National and Labour won't be kept?

KEY: Well, yeah, look, there are always risks as, in a sense, I don't think beneath the surface, Labour has truly moved towards the centre, and I think the language they want to use and the spin they want to put on things is that they've got a tinge of blue in them, if you like, and they are hunting in the centre ground. Inevitably that's where most New Zealanders inhabit and if we don't try and win that space then by definition, it pushes us out to a much smaller audience. And clearly we want to win the bulk of the party vote come Election 2008. So in a sense, we don't make any apologies for hunting in that ground but I think there will be very different outcomes. Fundamentally, we trust the private sector and we trust New Zealanders to make good judgement calls for themselves and their families, and we don't think Labour does and we think that their response is always one of the sort of Nanny State where Wellington knows best. When you see the results of the last few years, I mean, health is just a classic example, no one can say that Labour hasn't thrown enormous amounts of money at it - they've taken the spending up annually from $6 billion to about $10.5 billion a year, but the results are at best pathetic. And why is that? Well, because they're hiring as many bureaucrats as they are nurses. So I think you'll see a very different approach from us, but one that the public will buy into, and I don't think it's one where they will be intimidated by it. I mean, my view is that if someone is looking for a hip operation or a knee operation, they care about the quality and the timing of that operation; in the end, the hospital that carries it out is probably irrelevant.

INVESTIGATE: I see the suggestion that women in Nelson/Marlborough will be without epidural services, because the government has rundown the health system to that extent, in what is a major provincial city.

KEY: That’s an example of where their priorities are wrong. I think you can argue the same case with Pharmac – I mean, Pharmac’s funding has been static for the last four years, in nominal terms it’s been around half a billion dollars. In the last election campaign our policy was to increase their funding reasonably dramatically, and of course we were going to do that by not rolling out a subsidy in another area, but we thought that was a better allocation of funds. Now, that doesn’t mean it’ll be our policy in 2008 but what it shows is, I think, that we are prepared to tackle – you can’t just look at these incredibly large portfolios and just argue that there’s one solution, throw a bit of money at it and you’ll get the right outcome at the other end. I think you really do have to demand productivity and performance and have the right allocation of resources.

INVESTIGATE: From my own time in Government working for Mike Moore in 1986, one of the key things in that first Lange administration was the perception, the hangover from the Muldoon years, of “bureaucracy capture”, whereupon a lot of the civil servants at the time had been with a National administration for years and were used to dealing with National and were very suspicious of the incoming Labour people. The reverse is now the case, you have bureaucracy capture with Labour – Tamihere touched on it in his interview with Investigate last year about the networks that now exist in the civil service. How seriously do you treat that as a problem?

KEY: I think the winds of political change drift pretty rapidly in Wellington, it’s a world that revolves around the Beehive and Parliament, and my sense of the anecdotal stories and approaches below the radar screen that we’re getting at the moment is that the core bureaucrats in Wellington can sense pretty rapidly a change.
So while, superficially, they may have nailed their colours to Labour’s mast for a while I think they can see that the time of this government is rapidly coming to an end and they’re making pretty clear and overt signals that they want to work with us. Of course, we’ll have to demonstrate through our policies and our people that we’ve got the goods, but I think we very much do.

INVESTIGATE: One of the issues, with the State Sector reform of the 80s, and it’s been a bit of a bugbear for parties in Opposition when they want accountability out of Ministers – is that Ministers now say “well, we can’t touch these civil servants because it’s all independent…” – Is there room for more political control of the senior departments and so forth so that you can get accountability back into the political system?

KEY: Well I think you do need accountability. My guess is that the public will be looking aghast at the Liam Ashley case, and asking why a Labour party in opposition were so quickly calling for heads on the National side when we had Cave Creek, and yet when it comes to Liam Ashley they’ve been pretty quick to accept that they are politically accountable but not responsible, and therefore they don’t intend to do anything about it. So I think the public is entitled to accountability, and across a wide range: accountability even just for value for money – I think New Zealanders know they are paying a hell of a lot in tax, that the government expenditure has increased dramatically and in part that’s putting pressure on inflation in New Zealand, yet coming out the other end is something that even the incoming briefing to ministers confirms – to describe it as “sub-optimal” would be gilding the lily. It’s really a very low level of productivity. Yet every quarter for the last 20 quarters we’ve seen the state sector wages rising faster than the private sector, so there’s a real imbalance here. Government is a big beast now, and we need to have that beast performing if New Zealand’s economic growth and productivity levels are going to get us back into the top half of the OECD.

INVESTIGATE: Well that gets me back to the question about bureaucracy capture, because there is this perception that we have an elected political system, but it has been disconnected legislatively from the civil service that it operates –

KEY: Well I think that’s been a deliberate political ploy by Labour, I think you’ve seen that through the DHBs – that was a level put in place to ensure, again, that they were responsible but directly not accountable. Every time you ask a question they can simply say ‘Well that’s a matter for the DHB, take it up with them’, and when you try and take it up with them you get a blank response. I don’t think any of us should underestimate that Helen Clark is a cunning woman who understands the systems well and has worked them to her best advantage.

INVESTIGATE: So is a Key government likely to be brave enough to figure out some way to bring that accountability back in legislatively so that it can control the public sector?

KEY: We’ll certainly take a look at it. I think it is important when money is spent – and we’re talking about very large sums of money – that people feel there is a process of accountability. It’ll probably never be at the level that every journalist and lobby group would want, but I think nevertheless there are improvements that can be made.

INVESTIGATE: In other words the pendulum has swung too far?

KEY: That’s my sense of it. Like it has in so many things with Labour, it never self corrects until it’s exposed.

INVESTIGATE: If you had to describe the Labour years, and taking the good with the bad, what would you say their biggest achievements are?

KEY: Arguably they’ve been in the social policy area, you know, whether it's banning smoking or changes that they've made in areas like civil unions - I'm not arguing whether they are good or bad, I'm just saying that they've achieved a result. If you look on the other side, economically, while I think they would point to the fact that there’s been reasonably strong levels of economic growth and job creation, I think if you really look at their policies they've just been riding a wave that they did very little to create. And I think when you really look back on the Clark years she won't be remembered for what she's achieved. I think she'll be remembered for the way that she managed her caucus. There's a big difference.

INVESTIGATE: On the flipside of the same coin. What are their biggest weaknesses?

KEY: Well, their weaknesses are, I think, they have very low levels of aspiration. Fundamentally, Michael Cullen and Helen Clark are deeply conservative people who doubt Kiwis ability to really make it on the world stage, so they don't invest in things like infrastructure heavily, because they're just not quite sure whether we'll make it or not. Everything is done incrementally, everything is sort of second-guessed and micro-managed, and my sense of it is that New Zealand is sitting on a huge opportunity, which if it doesn't capture in the next 20 or 30 years, will really set us back, because for the first time in our history we are probably in the fastest growing time zone.

We've got a world around us that’s rapidly going to start buying the kinds of products that we want, but equally we're facing competition that most Kiwis haven't really focused on, coming out of countries like Latin America, for some of our core areas like agriculture and forestry and wine, and ultimately the same thing could be true of tourism. And so I think you've got this sort of interesting world where on the one hand, there is this great opportunity – and the Internet is the same thing: all of a sudden people can tap into a billion people worldwide, have a niche product that they can sell from New Zealand and from their home (which may not necessarily be located in downtown Wellington or Christchurch), so the opportunities are limitless, and the tyranny of distance has been removed. But on the other side of the coin, the competition is coming from people that we are not solely focused on, and it's coming on stream pretty quickly.

So it is not a scenario where New Zealand is doomed if it doesn't get its policies right, but it's a scenario where we don't achieve what we are capable of achieving. I think that would be hugely frustrating for Kiwis, and it's also, I might add, extremely dangerous, because we're sitting on the border of a country which is pretty aggressively focused on building its competitiveness - in the form of Australia - and we're already seeing that: 685 Kiwis leaving a week. We’ve got a brain drain that the OECD is starting to mention as our number one issue, given that it is the highest in the developed world. So I think we really have to worry about those competitive threats and the only way to fix that is to come up with a set of policies under a timeframe, and with a commitment, that are world-class, that do sort of challenge where New Zealand could be if it wants to achieve the kinds of outcomes that it is capable of achieving.

INVESTIGATE: Catch-22 for National: under the new Brash leadership when he came on board, his Orewa 1 speech, catapulted the party back from the political doldrums to the point where it almost won the last election. He touched a nerve quite clearly on this whole issue of race and multiculturalism and everything that went with it. How difficult is it to you as a new leader to keep that support there and yet find a way of navigating a softer line?

KEY: Well I think firstly, that obviously it’s critical that you maintain your core support, and I'd say National's core support is in the mid-30s. I think that's sort of where it sits, and that's probably fundamentally true of Labour - we probably both have core support of around about 30 odd percent. But we had a particularly bad year in 2002, partly because MMP is very cruel to you when you are doing badly because they don't necessarily jump to the centre-left, but they just go off to a party on the centre-right, and we saw that in 2002. The good news is its kind to you when they think you're going to win and you're doing well, you pick up a whole lot of people who vote for a winner even if they are a little unsure. So we obviously need to maintain our core support, which is critically important.

The future of New Zealand is changing and we need to change with it. If we don't, then ultimately there is no long-term future for the National party. Political parties represent the populace if you like, and we need to be part of that. If you really look at the policies, as I've said, fundamentally our policies on race have not changed: we believe absolutely in all New Zealanders being treated equally before the law, we believe in a speedy settlement process of historical claims and we believe in the abolishment of the Maori seats - if there's a change, then it is over the timetabling of when that abolition will take place. It's likely that our first caucus in February will come up with something that will reflect, arguably, a more conciliatory timetable around the abolition of those seats.

So really, in a sense, all I changed is probably the tone. I make no apologies for wanting to talk about the language of development, not the language of grievance. But I do that for a number of reasons: firstly, of course as a political leader I could spend my life absolutely honing in on everything that separates us, and these days we are a pretty multicultural society and there are lots of differences. But equally, I believe that we've got to focus on what unites us and sort of have enough maturity as a country to say ‘there's a lot that binds us together’, and even though there are many voices singing the same song, we've also grown up enough to recognize there are some differences as well.

INVESTIGATE: We are heading into a world that is increasingly turbulent, and I raise the example of Investigate columnist Mark Steyn-

KEY: I know him, yes.

INVESTIGATE: -and Steyn has just published a book called America Alone where he makes a very telling case that, for example, Europe as we know it with its various different European cultures, will effectively cease to exist within one generation because of the huge influx of immigration from overseas. I think Muhammad is now the most popular name for baby boys in Belgium, and I think running at number two in France, so you are getting this huge cultural tidal shift. And that's part of the reason they've had these riots over there. But what he is basically saying is, the world is a very changeable place and the demographics are changing - in the West our birth rates are falling and our populations are becoming older. What does this mean in the next 15 to 20 years for New Zealand?

KEY: I think we know that there will be a changing ethnic mix in New Zealand - most of the forecasting indicates that this is likely for the reasons that you pointed out, that we have a birth rate that is below replacement and unless we want to see our population fall then it is likely there will be some [ethnic] change.

I think our position is slightly different in Europe. Europe's had fairly open immigration for lots of different reasons, New Zealand's been a country largely based on immigration. So I don't think we need to be fearful of that. But I think we should just apply sound tests, which are: it's our country, we should choose who we want to come here and who doesn't come, and in choosing that we should pick people who we think can make a contribution, that can ultimately settle in and become New Zealanders. My sense is that we've achieved that pretty well so far. There's always a process of digestion if you like, but I feel pretty confident we can manage that process.

INVESTIGATE: Is there a need as part of that process increasingly to have some sort of national written constitution so that everyone who is a citizen of New Zealand understands what our basic principles are and we swear allegiance to that?

KEY: A written constitution, not necessarily, but one of the things you've seen in Australia, and I have some sympathy for, is that through the curriculum and through the education system they promote very heavily to young Australians, wherever they come from, a deep understanding of Australia's history, of its natural fauna and flora, all the historical icons of Australia. I think that's something that can be looked at in New Zealand, because I think it is very important that when people come - not that they forget their historical roots - but the thing that will make any country work is not that we have differences, because clearly we will have some, but we also have something that we feel binds us together. What it means to be a New Zealander.

At the moment, I would argue that we are best at expressing that when we are not in New Zealand, when we see each other on the tube in London or we are somewhere else. I think, increasingly, Australia has done quite a good job of that, you've seen this sort outpouring of nationalistic pride on Australia Day, my sense is New Zealand will evolve with the right political leadership to that. In other words, a sort of coming together of what it means to be a New Zealander, and there are certain pathways we can do to help achieve that in a world which, as you say, is likely to have greater immigration as a feeder of its population.

INVESTIGATE: In terms of the rise of yourself and Bill English to leadership, I was reading the blogs for the next few days afterwards, and the reaction from some of the right-wing blogs was, “Oh heck, it's Labour lite!”. What's your reaction to that, have they got reason to be fearful or do you think you'll be able to persuade them and keep them on board for the next couple of years?

KEY: I think we will absolutely keep them on board. Look, there will always be a wide range of views. Again, if you go back to Holyoake, I think, he said if the party agreed with him 60% of the time he was doing pretty well. You are never going to get somebody who is going to agree with absolutely everything you say, and every policy you take as a leader, even as a political party.

So in the end it comes down to a kind of theme, and values and the way you handle the decision-making process. Of course there will be some on the extreme right, who will want to have policies that we are not likely to be advocating, and again some on the extreme left, who will want policies that we are not likely to be advocating.

Again, I make no real apologies for saying I take a relatively pragmatic view of things. In the end I want policies that work, but pragmatism should not be mistaken for not being decisive. I think we proved in the early weeks of the leadership that we are certainly prepared to make decisions, even hard ones, and we will make them pretty rapidly. I think even in my political career in the last 4 1/2 years, I've proven that through things like the tax plan, which was the biggest tax cutting plan that New Zealand has seen in its history. So I don't think people can say that I'm not prepared to make hard decisions or decisions that when I believe in them I'll back them.

INVESTIGATE: Is this a sign of how you will treat your responsibility in government - as Helensville MP, you were personally not worried about civil unions but you had a large amount of lobbying going on in your electorate that suggested the people in your electorate who had voted for you did not want that passed. Still in a conscience vote, you opted to recognize the will of your electorate. Is that something you see as being fundamental to being a politician?

KEY: Yeah, and you can take two views on conscience issues, one is to say that you vote on your own conscience, only what you