Donghua Liu – clearer than mud

So, just yesterday the NZ Herald were reporting that Donghua Liu would not be commenting further on his political donations and would not be supplying any affidavits regarding dollar amounts, and I was calling for Mr Liu to come clean.

Well, whaddaya know? This morning the Herald has suddenly obtained a signed statement from Donghua Liu dated 3 May 2014, two days after Maurice Williamson resigned as a Minister. I’m interested in where it came from. Stuff.co.nz had previously reported that Mr Liu was poring over an affidavit with his lawyers, who were concerned about the lack of documentation. The statement obtained by the Herald apparently isn’t a sworn affidavit, but it is signed by Mr Liu. One wonders who’s slipped it to the Herald… And is there another draft affidavit out there, lurking in a lawyer’s office, never to see the light of day?

Regardless, this signed statement is hugely embarrassing for the Labour Party, given their “cash for access” attacks on National. The Herald reports the statement as saying:

• Liu paid “close to $100,000” for wine at a 2007 Labour Party fundraiser;

• That he spent $50-60,000 hosting then-labour minister Rick Barker on a cruise on the Yangtze River in China in 2007; and

• That Liu visited Barker in Hawke’s Bay in 2006, having dinner with him at an exclusive lodge and then meeting for breakfast the next morning. Liu said he made a donation to Hawke’s Bay Rowing, which Barker was associated with.

Rick Barker, after challenging Mr Liu to put specific allegations in writing, may now be wishing he’d kept his mouth shut. The contents of the statement mean that Mr Barker has some serious explaining to do. A $50,000 to $60,000 cruise on the Yangtze River is something that should have been disclosed, so will Mr Barker now rely on “brain fade” or will he call Mr Liu a liar?

And of course there’s the big question of what happened to the “close to $100,000” donated to the Labour Party. Many of my questions from yesterday remain.  Why does no one in Labour seem to know anything about this (apart from the Herald’s two un-named Labour sources)? Wouldn’t an almost $100,000 winning bid for a bottle of wine have turned a few heads at the time? Who in Labour received the donation, or was it an electronic transaction? If it wasn’t an electronic transaction, was it cash or a cheque? Did it go to Head Office or to one of the electorate committees?

Over at the Pundit site, Professor Andrew Geddis focuses on donations to Labour from law firms on behalf of undisclosed clients. Labour received three such donations – one of $150,000 from Palmer Theron, one of $50,000 from Simpson Grierson, and one of $30,000 from Morrison Kent. Professor Geddis focusses on the $150,000 donation, suggesting that it might have come from Mr Liu, and noting that if Liu doesn’t confirm or deny it, we’ll never know. However, Liu’s statement refers to a donation “close to $100,000”. That’s a more than $50,000 shortfall between what Liu says he donated and the Palmer Theron donation.

Lynn Prentice yesterday referred me to a 2010 blog post by Professor Bryce Edwards, “Pansy Wong’s dubious solicitation of political funding“. It refers to a fundraising event held by Pansy Wong in 2007, at which $200,000 was raised, including $50,000 paid by a Chinese businessman for one of John Key’s ties. The money didn’t appear to have been declared by National in 2008, and Professor Edwards discusses various reasons why that might have occurred. One of those reasons is the then practice (apparently illegal now) of treating a fundraising event as a “bogus business venture”, with all money raised classed as “business transactions” rather than donations. Thus, in terms of the $50,000 tie, the party could argue that the business valued the tie at $50,000 and it was therefore a valid “business transaction”. It’s entirely possible that Labour has adopted the same approach in the Donghua Liu situation.

Professor Edwards has called for a police or parliamentary enquiry. As Professor Geddis has pointed out, “[t]he Electoral Act in 2007 contained a six-month time limit on any prosecutions for filing a false electoral return”. That’s a time limit that has long since expired… The court of public opinion is the only court that Labour will be tried in, which may be damaging enough, given how soon the election is.

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