Updated: Mar 29
"Confidential settlements" are in the news again. The latest big scandal to involve them has some festering New Zealand connections and mirrors recent New Zealand events.
The former Chief of Staff to the former Maltese Prime Minister has been charged with corruption and money-laundering, and another man is being extradited to Malta from the UK.
The trial is barely over of men accused of murdering journalist Daphne Caruana Galizia, who had exposed the laundering of money through New Zealand. She had received death threats, and the revelation that high-placed Maltese officials appeared to be laundering dirty money through New Zealand came to further attention with the publication of the Panama Papers in 2016.
Interest then focused on New Zealand's "foreign trust" system. Pressure to bring in a public register to prevent that form of laundering was successfully resisted, including by Professor John Prebble, a tax lawyer from Victoria University. He said New Zealand had no interest in taxing overseas money, and some people might have a good reason to want secrecy. And that a register would damage the business of lawyers who dealt in foreign trusts.
There was apparently also little interest when Daphne Caruana Galizia was murdered in October 2017.
By then, the New Zealand Employment Court had firmly established a parallel contract law system within New Zealand, allowing for another form of corruption. As this website has identified and reported before, it allowed coverups which, in terms of normal law, entail fraud and false accounting, but which government officials and the judiciary accepted and enforced. They still do. That is hardly surprising, looking at the number of judges who have previously accepted stolen public money to pursue those arrangements. They are in a position to say it was all legal, not stolen, and so to save themselves.
So fraud is now legal, because, if MBIE says so, it can't be reported as fraud.
This remarkable position appears to have been established by two men with academic positions at Victoria University being terribly clever. Senior quasi-lawyer Tony Smith appears to have advised that any order made must be obeyed unless it is set aside, or that's contempt! His former assistant Gordon Stewart appears to have assisted with the systematic statutory misinterpretation now paraded in detail by lawyers and judges alike to justify their conduct. Ministers such as Grant Robertson (Finance) and Andrew Little (Justice) have for some reason willingly supported that project.
The project cannot be stated without at least implying that it is wrong. The officials, lawyers and judges have all decided that wrongness cannot be countenanced in New Zealand. So it also can't be dealt with.
It was - and is - a system Daphne Caruana Galizia would have recognised immediately, and would surely have spoken up about, though its flagrancy might be beyond anything she would imagine.
It also hardly requires investigative journalism. It is all, quite literally, on the record, all the way up to and including the Court of Appeal.
But it appears everyone up to and including Transparency International is scared to talk about it ... which, given the fate of Daphne, is perhaps unsurprising.
So what of the recent developments in Malta?
On 12 March 2021, Victoria University suffered an outage of its hard drives - the C: drives to which computers saved their automatic backups, rather than any central drives such as the H: or M: drives.
The main way for operating the various employment frauds has involved making and using forged material, and then stripping the chosen victim's file.
Similarly, for procurement and invoicing frauds and money-laundering, the fake material has to be maintained to justify the money taken, but it also has to be "confidential" so that it will never be identified as fake. The production of faked or conflicting records would be fatal ...
... or that would be a fear, if a government were ever to stand up to MBIE and start a clean-up operation - but the employment jurisdiction is content to run coverups and the external courts accept that all the way up (nearly) ...
... so the evidence needs to be readily removable.
On 20 March 2021, Karl Schembri, the former Chief of Staff, was charged with corruption in Malta. Adrian Hillman, formerly a managing director of Allied Newspapers in Malta, is being extradited by the UK. It is expected that others will be charged as well.
Adrian Hillman left his office and his job on 11 March 2016, the day that Daphne Caruana Galizia reported on corruption and kickbacks - with a computer hard drive.
He brought an employment case against his employers, and ... there was a confidential settlement.
The hard drive has apparently never been recovered.
The dots must be joining up, even in the international authorities.
Someone might one day want to do a clean-up.
There might even be some officials in New Zealand who want to clean up, or become scared of being caught not doing it ...
New Zealand's lack of interest will be irrelevant as soon as they do.
* We're not picking on Malta; we have problems too, as you will see: https://www.leightonassociates.co.nz/post/how-to-gag-a-whistleblower-in-the-nz-public-service-by-kim-leighton