Scoop Election 08: edited by Gordon Campbell

Gordon Campbell on the John Banks vs Kim Dotcom saga

April 30th, 2012

Article – Gordon Campbell


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Cartoon by Martin Doyle

Is it too soon to start talking about the curse of the Act Party leadership? The toll at the top is becoming quite alarming….Rodney Hide, Don Brash, and now John Banks is in trouble. To the point where Banks’ current line of defence about the source of certain unidentified large donations to his 2010 Auckland mayoralty bid is starting to sound very reminiscent of Sergeant ( “ I know nothing – NOTHING”) Schulz from the old Hogans Heroes TV show. Maintaining a defence of plausible deniability may serve to keep you out of a courtroom, but it doesn’t do much for the credibility of you and your party in the court of public opinion.

The point of having disclosure rules about political donations is that the public can thereby be made aware of whether politicians are beholden to certain people or organisations whose interests may figure in their future decisions. If those financial linkages are out in the open, the transparency will (hopefully) deter favouritism and other corrupt practices. In that respect, the provision that permits the source of large donations to local body election campaigns to be entered as being from “Anonymous” sits somewhat oddly with the democratic imperative to avoid the buying and selling of political influence. In some cases, the politician may truly not know who certain donors were, and there is some point to keeping the donor and the recipient at arms length. As the sums involved escalate however, it gets harder and harder to find it plausible that the likes of John Banks – for example – would remain in the dark about who had given this kind of serious money ($15,000 from Sky City, and two separate donations of $25,000 each from Kim Dotcom). Arguably, when sums of this size are involved, knowing the identity of the donor is more vitally important to the public than knowing the bald figure of how much was donated – useful though that can be.

What did Banks know and when did he know it? In Dotcom’s reported version of events, Banks allegedly advised that the donation should be split in half, so that it could be recorded anonymously. Under the Local Electoral Act 2001, the rules about donations to local body election campaigns are less strict than those for national elections – and the cut-off point for when donations have to be recorded is in fact $1,000, not $25,000. So even $10,000, $25,000 or $50,000 donations could all legally be recorded as coming from “ Anonymous.” Nonetheless, it is true that a huge $50,000 gift would have stuck out prominently. Even Sky City for instance, donated only $15,000 each to the mayoral campaigns of Banks and his main rival, Len Brown. A cautious political operative might well want to split and spread the size of large and noticeable donations.

Under the laws of disclosure for local body elections, the issue of illegality turns on whether the candidate knew – and can be proven to have known – who the anonymous donor was, by the time the campaign expenditure returns had to be filed, some 55 days after election day. Unless an email or a ‘thank you’ card (or some other documentary evidence) emerges showing that Banks knew that a particular large donation listed as ‘Anonymous’ actually came from Dotcom there can be no legal repercussions. As for the Sky City donation to Banks… that gift became public knowledge in mid December 2010, shortly after the mayoral campaign expenditure returns had been filed. Could Banks have amended his return to identify the $15,000 donor? Perhaps, but there was no legal obligation on him to do so.

According to Dotcom, Banks rang him later to thank him for the donation, and phone records may well confirm that a call was made – but not its contents. So that may remain Banks’ word against Dotcom’s. Banks could also argue that his original advice was misunderstood, and that he was merely offering advice in general about anonymous donations. To repeat : unless there is a paper trail demonstrating that Banks had clear knowledge of the Dotcom and Sky City donations at the time he filed his expenditure return, he is going to survive.

Public perception, of course, is a different matter. The whole incident will have done nothing to improve the public standing of politicians. Ironically, the fact that the perception of politicians is already at rock bottom may serve to spare Banks from much in the way of further political embarrassment. In similar vein, those donations made by Sky City to both the main candidates for the Auckland mayoralty will be doing nothing to boost the public’s confidence that the controversial Sky City ‘pokies for convention centre’ deal will be assessed objectively.

Len Brown, who has long been vocal about the social impact of problem gambling, still has some explaining to do about his acceptance of a $15,000 donation from the casino operator for his mayoral bid – a relationship that cannot help but cast a shadow over such matters as yesterday’s headline “Mayor backs Sky City convention centre”.

Dotcom may well be feeling a measure of satisfaction about Banks’ current plight. Reportedly, Dotcom revealed the saga of the mayoral campaign donation after feeling abandoned by Banks (I know NOTHING of this man) after Dotcom was arrested earlier this year. It will do nothing to endear Dotcom to the government when it comes to the US extradition request – but thankfully the decision on extradition will be made by the New Zealand courts, and not by Banks and his chums in government.

ENDS

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    1. 6 Responses to “Gordon Campbell on the John Banks vs Kim Dotcom saga”

    2. By Sridhar on Apr 30, 2012 | Reply

      “Dotcom revealed the saga of the mayoral campaign donation after feeling abandoned by Banks”

      When in doubt!
      a) never betray your friends / well wishers.
      b) If you are not sure don’t accept donations
      c) if can’t keep away from a) and b) don’t be hesitant to accept your guilt.

      If you don’t follow these principles the past can come to haunt you. Unfortunately, John Banks is not the only one to not follow these principals. Unfortunately, history knows how to repeat itself.

    3. By Natalie on Apr 30, 2012 | Reply

      What about indirect donations like those made to favourite charities like John Walker’s “Field of Dreams”. Could these be seen as indirect political donations which may sway the way a person votes?

    4. By Joe Blow on Apr 30, 2012 | Reply

      If the allegation is true, then I think there will be some kind of evidence to back it up. Surely there are other witnesses to the transaction that can vouch for Banks having the requisite knowledge? The evidence doesn’t have to be on paper. I worry more about whether the police will do a proper investigation…

    5. By Sridhar on Apr 30, 2012 | Reply

      Just change the law that all donations must be from known persons.No more anonymous donations. If donors hesitate to reveal themselves, so be it. At least that will keep politics cleaner. Yes parties may suffer but that is not the priority.

    6. By David on May 1, 2012 | Reply

      Hey Gordon, thanks for the piece. I especially liked the reference to Schultz.

      However you write:

      “Unless an email or a ‘thank you’ card (or some other documentary evidence) emerges showing that Banks knew that a particular large donation listed as ‘Anonymous’ actually came from Dotcom there can be no legal repercussions.”

      My interpretation of the law means that this is not entirely correct.

      s 134 of the Local Electoral Act 2001:

      “False return

      (1)Every candidate commits an offence who transmits a return of electoral expenses knowing that it is false in any material particular, and is liable on conviction on indictment to imprisonment for a term not exceeding 2 years or to a fine not exceeding $10,000.

      (2)Every candidate commits an offence and is liable on summary conviction to a fine not exceeding $5,000 who transmits a return of electoral expenses that is false in any material particular **unless the candidate proves—

      (a)that he or she had no intention to mis-state or conceal the facts; and

      (b)that he or she took all reasonable steps to ensure that the information was accurate.”

      So, we have two offences here. The media has been repeatedly stating that it is the Police’s job to prove Banks knew about the impropriety.

      For the lesser offence (ss 2) the burden is shifted so it becomes Banks’s job to prove he had no intention and took reasonable steps to ensure it is accurate.

      This is known as a reversed burden, and it will be difficult for him to weasel his way out of it.

    7. By Chuck Bird on May 1, 2012 | Reply

      According to 3 News Banks had $638,512 of anonymous donations. Obviously many in the media believe that Banks knew with absolute certainty of at least $65,000 of those anonymous donations. Gordon, do you believe that he know of more? If so, do you also believe that Len Brown knew of any of the $499,000 of anonymous donations he received?

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