The former ‘kamikaze’ MP was cleared of all charges, as were three people linked to a Labour donation.
Three men have been found guilty in relation to donations to the National Party, though former MP Jami-Lee Ross is not among them, with the former MP, who embarked on a “kamikaze” mission against his then leader, judged not guilty on all charges. Not guilty verdicts were returned for all charges relating to a donation to the Labour Party, including three defendants whose names are suppressed.
In the Auckland High Court businessman Yikun Zhang and twin brothers Colin and Joe Zheng were found guilty of using a fraudulent device, trick or stratagem to deceive in relation to $100,000 donations split into sums under $15,000 to avoid meeting the disclosure threshold. Zhang was found guilty for his role in the 2018 donation but not guilty over a 2017 donation, as was Joe Zheng. His twin brother, Colin, was found guilty in relation to both donations. Joe was also found guilty of providing false or misleading information in an interview with the SFO.
Justice Ian Gault delivered the verdicts in person, with his written judgment and reasoning for the decision to follow in written form. All those convicted were granted bail ahead of sentencing on November 30.
Ross embraced his lawyer Hannah Stuart in the courtroom, while the other acquitted defendants shook hands. Yikun Zhang, his translator alongside him, was motionless.
The verdicts come 10 days before the fourth anniversary of the jaw-dropping day when Jami-Lee Ross, then a National MP, sought to incriminate his then leader, Simon Bridges, and thereby himself, for breaches of donation rules. His overnight drive down the North Island and press conference on the tiles at parliament, followed him being pinpointed as the source of leaks relating to Bridges’ expenses. During the trial, Ross accepted for the first time that he had been the source of those leaks, via his lawyer, Ron Mansfield KC.
Ross’s behaviour at the time took the form of a “kamikaze” mission, his lawyer had told the court. His mental state left him indifferent to the truth. “It is unusual for any counsel to stand before the court and describe their client as someone who has lied,” said Mansfield. “But I so do. And that is because it’s readily apparent that Mr Ross lied. The very statements that the SFO rely on against him can be described simply as lies.”
Speaking outside the court this morning, Ross said he was “very relieved” by a verdict which drew a line under “four long years”. He said he was looking forward to reading the judgment but that the court had “come to the right decision about me, that I’m not guilty of any of these crimes”. He thanked his lawyers who “did an amazing job and looked after me for the best part of two and a half years.” Asked whether he might resurrect his political career, Ross said: “I just want to move on now.”
Three donations were at the heart of the case. According to prosecutors two $100,000 donations had been split into parts to duck under the threshold for declaration, in 2017 and 2018. The other was a $35,000 donation to Labour in 2017, which the Crown alleged involved the sum being split across five auctioned paintings. Across seven charges, there were five guilty verdicts and 18 not guilty verdicts. None of the guilty verdicts pertained to the Labour part of the trial.
The crown had contended that Yikun Zhang was the true source of all of the donations. Through the use of “sham donors”, he provided the funds to the parties, “no doubt in an effort to obtain influence with them”, while keeping his name from the public gaze, it said. He may have been motivated, prosecutors said, by the potential prize of a royal honour, “without there being any suggestion of influence”. In 2018 Zhang was appointed a member of the New Zealand Order of Merit, for services to New Zealand-China relations and the Chinese community, reflecting in part his work as founder and chairman of the Chao Shan General Association, a group representing the region of China where he was born and raised.
The defendants, claimed prosecution lawyers, had lied. With one exception: “The only one who didn’t lie, or at least, didn’t lie about his involvement, was Mr Ross,” argued the crown in closing. “He told the truth; he knew what was going on, he knew it was wrong, and he did it anyway.” The court appears to have accepted Ross’s version – that he was lying then, rather than now.
In a courtroom crowded with gowned barristers, the defence teams for the various charged individuals put forward a range of arguments, but all – Ross’s counsel notwithstanding – presented the SFO case as a theory in search of substance. No defence witnesses were called, with lawyers cross-examining crown witnesses and contending that it was a case stitched around a paucity of evidence.
Among the arguments put forward by defence lawyers were variously that investigators had relied on questionable translations, failed to grasp cultural differences and omitted to identify a “benefit” sought or gained. In relation to the Labour donations, defence lawyers homed in on the SFO decision not to have the paintings formally valued.
Representing one of the defendants cleared in relation to the Labour donation, Marc Corlett KC grilled SFO investigators over the basis for the search warrant executed on his client’s family home, which appeared to confuse a MacBook Air and a MacBook Pro and leap to puzzling conclusions based on a photograph of a Zoom conference.
Criticisms were levelled in relation to the SFO use of section 9 orders, which provide extraordinary powers of interrogation to the organisation’s investigators, and associated obligations of silence placed on those interviewed and served with S9 notices – of which more than 150 were issued through the investigations. Questions were also raised about the decision to lay the charges under the Crimes Act rather than the Electoral Act.
Sam Lowery, lawyer for another of the men with name suppression, told the court the SFO was right to have conducted a thorough investigation, but there was a danger of the sunk cost fallacy in “barreling ahead with charges”. He said in summing up: “Criminal proceedings aren’t a game. It isn’t Monopoly. It’s the real world … The Crown has levelled very serious allegations against these defendants, life-altering allegations.”
Corlett took issue with the SFO’s modus operandi and motivations, arguing that the charges linked to the Labour donation were so thin that they looked to be prompted by an effort to appear bipartisan.
In a 2020 letter to public service commissioner, Peter Hughes, Michael Heron KC, then representing the same defendant, formally complained about the “performance and integrity” of the then SFO director, Julie Read. In the letter, presented to the court last month, Heron said his client believed the SFO approach was designed to “project an appearance of political neutrality in the context of this investigation in an apparent attempt to balance the investigations and subsequent prosecutions relating to the National Party and NZ First Party.”
He called for an independent assessment of whether the investigation had been motivated by a context in which “the future of the Office and its independent status as well as the director’s own personal tenure has been under review for some time”.
In its closing submissions, the crown said there was “no basis” for impugning the SFO’s “processes and motivations” and “this court should flatly reject them”. It further noted that “as this court (and defence counsel) will be aware, after the SFO elects to prosecute, and not guilty pleas are entered, the solicitor-general takes over the prosecution, through panel counsel, and makes its own assessment of the evidence and the charges.”
Across seven weeks, the court heard from witnesses including former National leader Simon Bridges, former Labour leader Andrew Little, cabinet minister Michael Wood and several officials from both parties.
In a separate case brought by the SFO in July, the High Court in Auckland acquitted two people, whose names have been permanently suppressed, on charges of obtaining by deception in relation to donations to the New Zealand First Foundation, with Justice Pheroze Jagose finding that the contributions did not constitute party donations under the law. The decision, which the SFO is appealing, prompted the government to make changes to the Electoral Amendment Bill to extend and clarify the definition of “political donation”.
Tension built this morning as the judge’s preamble was interrupted by a technical failure that meant one of the defendants’ lawyers was unable to view the denouement via video link from abroad, prompting a 20 minute adjournment.
The trial faced a number of interruptions, including other online link hiccups, one of the defendants testing positive for Covid, an SFO witness whose evidence was delayed owing to illness and an adjournment brought on by a power cut, but nevertheless came in well within the 10 weeks for which it had been put down.