Time to go John
” …a sense in which Andrew Little is responsible is that he has been part of a campaign of deliberate lies… It is very sad that an opposition party would [behave] so dishonestly…”
Given John Key’s entire tenure as prime minister is built on lies, this from Matthew Hooton over at The Dimpost’s comment section is somewhat ironic, and insulting.
In October 2008 as the then opposition leader, Key maintained his 1991 statement to the Serious Fraud Office investigation into failed corporate high-flier Equiticorp and it’s fraudulent H-Fee transactions with Australian corporate giant Elders IXL, was accurate. But his well documented relationship with infamous New York based Bankers Trust currency raider Andrew Krieger says otherwise.
We know Key worked with Krieger, this was confirmed in great detail by hi Bankers Trust boss Gavin Walker* in February 2008. Telling media Key knew everything Krieger was executing across the Auckland Bankers Trust’s branch’s trading desk; indeed looking after Krieger was part of Key’s job description. Key himself has said he can still recall his first phone call with the trader, saying Krieger asked him about New Zealand’s GDP and it’s monetary supply.
We can also be sure Key was at his previous firm Elders Merchant Finance on 17 August 1987, as he filmed for Close Up’s “Big Dealers” episode on that day. What we know of Krieger is that he resigned from Bankers Trust on 23 February 1988. His resignation is well documented, having been reported in the New York Times, the Wall Street Journal, and later in Krieger’s own book, ‘The Money Bazaar’.
To have worked with Krieger, which there is no doubt, Key needed to have left Elders Merchant Finance to start with Bankers Trust sometime after 17 August 1987 but before Krieger’s 23 February 1988 resignation date.
Therefore Key’s statement to the Equiticorp inquiry in which he told investigators he left Elders Merchant Finance for Bankers Trust on 31 August 1988 can only be a lie. His insistence to voters in October 2008 that his statement was entirely accurate can only be another one.
Lying to an SFO investigation carries a maximum $15,000 fine or twelve months jail, more for conspiring to mislead, and I think any investigation would find that’s exactly what Key (and his ex-Elders colleague Paul Richards**) did.
Time to go John.
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* Gavin Walker, current Chair, Board of Guardians of New Zealand Superfund
** Paul Richards, current head of Foreign Exchange Distribution, UBS, North America
Key’s biggest lie of all: his 1991 statement to the Equiticorp inquiry
The Standard has a posted an updated listing today of John Key’s lies. There’s a lot of them.
One lie that doesn’t often make these lists is what I believe to be the biggest lie of all: his 1991 statement to the Equiticorp inquiry.
In July 1990 New Zealand’s newly formed Serious Fraud Office were charged with investigating the shambles that was Equiticorp and it’s now infamous founder Alan Hawkins. Unraveling a ledger entry called ‘H-Fee’ ultimately saw Australia’s SFO equivalent, the now defunct National Crime Authority, assist with the Equiticorp investigation. While the SFO pursued Hawkins over Equiticorp, the NCA went after Australian based Elders IXL and it’s founder John Elliot over the ‘H-Fee’ entries. It was alleged that $67 million (NZ$76) in fraudulent foreign exchange transactions were made in two payments to Equiticorp to pay back Hawkins for his assistance in Elliot’s 1986 takeover battle for steelmaking giant BHP.
Two years early on 26 August 1988, setting in motion the second (A$27 million) of the ‘H-Fee’ payments, Elders IXL executive Ken Jarrett had met with Elders Merchant Finance manager Peter Camm and head of foreign exchange, Paul Richards in Wellington. The transaction was completed on 7 September 1988.
One week before been elected Prime Minister of New Zealand in November 2008, Key was asked about the truthfulness of this statement. He said it was 100% truthful, 100% correct and anything else was “a smear campaign by a desperate left”.
Is it a smear if an accusation is true?
When the NCA brought charges against Elliot and other Elders IXL executives, Peter Camm and Paul Richards were also facing fraud charges. In May 1991, now working at Bankers Trust, Key was asked to corroborate a part of Richards statement, namely a lunch he claimed that two had on 31 August 1988.
Richards was alleging it was the 31st and not the 26th that he and Camm had met with Jarrett that August. The trader was adamant of the date and told investigators he could recall the “lunch” and it’s “date”, as it was a “farewell” for “John Key” who was leaving the firm to go to Bankers Trust. Key agreed with Richards recollection of events and made a statement to the investigation reflecting that.
Except Key worked with New York based currency raider Andrew Krieger while they were both at Bankers Trust. This relationship has been confirmed by Key’s then boss, Gavin Walker. Walker has said of the relationship, that it was more or less in Key’s job description to look after Krieger, saying on Key’s first day with Bankers Trust he gave Key a list of their top clients, of which Krieger was one of them. Key himself has said he will never forget his first call with Krieger, where he asked Key about New Zealand’s GDP and it’s monetary supply.
For Key to have worked with Krieger, of which there is no doubt, then he would have had to have left Elders Merchant Finance in August 1987, and not 1988 as told to investigators, as Krieger resigned from Bankers Trust in February 1988. By June 1988 he had retired from the currency markets altogether, not returning to them until 1990. Readers may also recall Key told a reporter in 2007 he had indeed left Elders Merchant Finance in 1987 but called that a mistake when his 1991 Equiticorp statement surfaced a year later.
If Key wishes the New Zealand public to believe he was telling the truth to them in 2008 when as a wanna be prime minister, he assured them his 1991 Equiticorp statement was 100% true and correct, then he needs to explain to us how he, in late 1988, supposedly began working so closely with a world infamous currency trader who was no longer working in the currency markets. He also needs to explain how Walker, now Chair of the Board of Guardians of the New Zealand Superfund, could have his recollection so wrong as well.
What authorities need to know is, knowingly misleading a Serious Fraud Office investigation carries a maximum fine of $15,000 and/or 12 months imprisonment. Not too mention the possibly criminal issue of Key and Richards conspiring to mislead an investigation.
While some might question whether or not Key lying in his youth has any bearing on the man today, the facts are some 55,000 Equiticorp shareholders were defrauded of over $400 million dollars.
If Key was willing to lie to protect those involved in facilitating some of that fraud, does he continue to lie today to protect himself?
In his book ‘Dirty Collars’ ex SFO head Charles Sturt says this of the vast powers bestowed on his department,
“while a person may be compelled to answer questions, these answers may only be used in evidence if the accused subsequently gives evidence inconsistent with their previous statements”
John Key, did you lie to the Serious Fraud Office?
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“Where the bloody hell are you?” Could Australia’s media do what New Zealand’s so far hasn’t?
Would Australia’s political pundits be as ready to embrace their brand new prime minister Malcolm Turnbull’s unflinching admiration of New Zealand prime minister John Key if they were aware that the subject of Turnbull’s affection had mislead an early 90’s investigation by their National Crime Authority (NCA) into the now infamous ‘H-Fee’ transactions? So what do you think? Would the tran-Tasman bromance still be welcomed despite it? Or would Australia’s journalists and commentators not be distracted by the flush of first love and actually call for the New Zealand prime minister to explain himself? Could Australia’s media do what New Zealand’s so far hasn’t?
When Key’s 1991 statement to the H-Fee investigations surfaced a week before he was elected prime minister in November 2008, the document was largely accepted as ‘truth’ – even to the point that one highly regarded New Zealand journalist used the statement as ‘evidence’ of Key telling the ‘truth’ about one of his more infamous pre-PM brain-fades. In 2007 Key had tried to front foot questions by New Zealand Labour party politicians about his involvement in the H-Fee investigation, and in doing so had told a journalist that the ‘Labour hounds had nothing on him because he had left EMF in 1987 long before any of the H-Fees we’re decided’. When his statement came to light and it showed Key had actually told investigators he had left EMF in 1988, not 1987 as he’d told this reporter, Key confidently reassured waiting media that what he told investigators in 1991 was the real year and if they were to hear anything to the contrary, then it was nothing but a left-wing smear campaign by a desperate Helen Clark and her then incumbent Labour government colleagues.
At the same time as Australia’s (now defunct) NCA were investigating the complex H-Fee foreign exchange movements between Australia’s corporate high-flier Elders IXL and New Zealand’s own Equiticorp, New Zealand’s newly established Serious Fraud Office (SFO) were trying to unravel this and many other dodgy movements of money into the hands of Equiticorp founder Alan Hawkins. The two investigating bodies worked closely together sharing information, running separate prosecutions within their own jurisdictions, with the NCA bringing a case in Australia against some of the offending parties over there and in 1992 in New Zealand the SFO’s brought successful charges against Hawkins. He was subsequently sentenced to six years in prison.
Key became involved in the H-Fee investigations when an ex-colleague of his Paul Richards, now head of forex at UBS in United States, was facing fraud charges for his part in one of the transactions. He had helped to facilitate some of the foreign exchange movements necessary to hide these transactions while working for Elders IXL’s New Zealand based subsidiary Elders Merchant Finance (EMF) in Wellington in 1988. Richards was only ever a bit player and eventually was given immunity from charges in return for giving evidence for the NCA’s prosecution across the ditch. Funnily enough a defense lawyer in that court case alleged Richards and Key’s statements to the investigation we’re completely made up, nothing but utter fabrication. What did they know that we don’t?
Richards who was first interviewed in November 1990, told investigators he could supposedly recall an event from 31 August 1988 because he and an ex-colleague ‘John Key’ had had a lunch that day. He could recall the exact date of the lunch because it allegedly marked his colleague’s last day with the firm. This date was at odds with the evidence of Richards’ boss Peter Camm and Elders IXL executive from Australia, Ken Jarrett, both of whom were also under investigation. Allegedly Richard’s was called away from the ‘lunch’ to meet with these two men. Jarrett had supposedly flown to New Zealand from Australia that morning.
In May 1991 Key was asked to corroborate Richards’ evidence. He told investigators he had given notice on 24 June 1988 and then two months later on 31 August the two colleagues were celebrating his final day, he was leaving EMF to head a newly established forex exchange department at rival finance company Bankers Trust. He confirmed Richards’ evidence about their lunch including how Richards had received a call and had to return immediately to the office. About 45 minutes later Richards allegedly returned, a little shaken but he told Key he could not go into detail other than to say he had just had a very strange meeting with his two co-accused. Allegedly the men continued their lunch and supposedly never discussed the strange turn of events again.
Now at Bankers Trust we were told Key worked with infamous American currency raider Andrew Krieger who was based at the company’s New York branch at the time. This relationship we we’re told was highly lucrative for the New Zealand branch and had soon turned the Auckland dealing room into the number one forex dealing room in the country. Reports about the success of this relationship worked to cement the then Leader of the Opposition’s backstory as a ‘state house kid made good’, a currency trader of some merit, a man at the top of his game, right in the thick of it with the world’s most notorious and infamous best. Key’s ex boss Gavin Walker, now chair of the Board of Guardians of the New Zealand Superfund, told media Key was responsible for the Auckland branch’s relationship with Krieger, it was in his job description to look after him and that as far as Walker was aware Key knew everything that Kreiger was executing across the local branch’s trading desk. Key himself told media he would never forget his first phone call with Krieger as the currency legend asked him about New Zealand’s GDP and it’s monetary supply.
Except Key working with Krieger means there is no time in 1988 that Key could have been working with Richards at EMF – it is simply not possible. Kreiger resigned from Bankers Trust on 23 February 1988 – some six months before the 31 August date Richards had told investigators, and later corroborated by Key, as been Key’s last day before he joined Bankers Trust in Auckland. Krieger’s resignation is well documented. He had disputed the amount of bonus he was due from his 1987 trades and promptly resigned leaving the company within a matter of weeks. Upon leaving Krieger spent one month on holiday before returning to the forex markets with another company. By June 1988 though he was disillusioned with currency trading and left the currency markets altogether, not only the markets but America itself, to study Sanskrit in India. He did not return to the currency markets until sometime in 1990. Even if Key’s statement to the H-Fee investigation is believed, it does not explain how he could trade millions upon millions of dollars of currency with someone that helped turn his trading room into the best in the country, when that person had left the currency markets entirely a couple of months earlier?
Did Key lie to the H-Fee investigations? More than likely. Will Aussie commentators think less of him for it? Hopefully. Not sure if Prime Minister Turnbull will, but no one will ever know unless the New Zealand media start asking Key to explain himself. Or could Australia’s media do what New Zealand’s media so far hasn’t?
In his book ‘Dirty Collars’ ex SFO head Charles Sturt says this of the vast powers bestowed upon his department,
“while a person may be compelled to answer questions, these answers may only be used in evidence if the accused subsequently gives evidence inconsistent with their previous statements”
So c’mon on journos, “where the bloody hell are you?”
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2008 6 March ALT TV: Oliver Driver (Lets Be Frank) interview where Key talks about working with Andrew Krieger at Bankers Trust
2008 30 October Radio New Zealand: Kathryn Ryan(Nine to Noon) interviews John Key about H-Fee a week before 2008 General Election
Legal scholar & author Frank Partnoy interviewed Andrew Krieger for the book “Infectious Greed: How Deceit and Risk Corrupted the Financial Markets” and dedicated a chapter to him. The intro & chapter featuring Krieger ‘Patient Zero’ can be read free on Amazon Kindle +PC. Click “Read first chapter free” to view.
Please share this page with others, thank you.
Key’s 1991 SFO statement may be his longest standing and most damaging lie yet.
I wrote yesterday about how well documented it is that Prime Minister of New Zealand John Key worked with currency trader Andrew Krieger while they were both at Bankers Trust in the mid 1980s.
A week before the 2008 election, a 1991 statement Key gave to the then new established Serious Fraud Office surfaced. In it we learned Key had told investigators he could recall a date crucial to the investigation because it was the same date as his last day with Elders Merchant Finance – he was going to Auckland to take a position with Bankers Trust – this is supposedly the time when he started with Krieger. Except this timeframe is an impossibility. Krieger resigned from Bankers Trust some six months before the date in question.
Key has either lied to media when they were doing background bios on him in 2008 about working with Krieger, or, and more likely, Key conspired to lie to the Serious Fraud Office to assist his ex Elders colleague Paul Richards who was facing fraud charges.
Gavin Walker who was Key’s boss at Bankers Trust, talked at length with media in 2008 about the relationship Key had with Krieger, going so far as to say managing that relationship was more or less in Key’s job description. Walker is now Chair of the Board of Guardians of the New Zealand Super Fund. Did he lie to media about Key working with Krieger? Because lying and misleading is the implication if Key maintains his SFO statement is true and correct – as he did in the lead up to the 2008 General Election.
As for Richards, he soon followed Key to Bankers Trust and may or may not have been still working there when he was first interviewed by the SFO in November 1990. If he was, did he and Key conspire to the mislead the SFO investigators? Constructing an elaborate back story of a ‘farewell lunch’ that never took place? The date of this lunch conflicted with the recollections of Richard’s co-accused. Richards is now head of UBS Head of FX Distribution in the US. He is a regular finance and foreign exchange commentator on television and news in the US and is a current and past (2012) member of the Foreign Exchange Committee of the New York Federal Reserve.
For the record, the investigation all those years ago was into the failed high flying company Equiticorp. Over 55,000 shareholders were defrauded of over $400 million, of which the would be New Zealand PM was willing to lie to investigators to protect his friend and colleague who had helped commit $67 million of that fraud.
A week before the 2008 election Key was asked about his statement and assured Radio New Zealand listens he did not lie to the SFO, maintaining his statement was 100% true and correct and claimed any talk of the contrary was nothing but left wing smears, attack politics from desperate opponents.
Today opposition leader, Labour’s Andrew Little called Key a liar over the PM’s knowledge of ex-Northland MP Mike Sabin’s police investigation – add another lie to Key’s growing pile of untruths and obfuscations but I think Key’s 1991 SFO statement may be his longest standing and most damaging lie yet.
Gavin Walker, John Key’s ex boss, now Chair of Board of Guardians of NZ Super Fund.
Paul Richards, John Key’s friend and ex-colleague. Now UBS Head of FX Distribution in the US.
John Key – ’91 SFO statement or working with Andrew Krieger: they can’t both be right
This Twitter tweet from right-wing political commentator Matthew Hooton caught my eye yesterday. Not because the Prime Minister of New Zealand John Key may be found out in another lie, rather it caught my eye because I’ve had similar “They can’t both be right” moments of clarity about our dear leader.
The most serious one involves a statement he gave to the Serious Fraud Office in May 1991 which surfaced in the lead up to the 2008 general election, and the reports of him working with the infamous currency trader Andrew Krieger.
In both the New Zealand Herald and the Sunday Star Times in 2008, and as recently as last year in John Roughan’s book ‘John Key: Portrait of a Prime Minister’, we were told Key worked with the infamous Krieger when they were both traders at Bankers Trust – Key in the Auckland branch and Krieger with the parent branch in New York. Key himself said he will never forget their first phone call, saying Krieger asked him about New Zealand’s GDP and its monetary supply.
Key’s boss at the time Gavin Walker has said it was basically Key’s job description to manage the relationship with Krieger, giving Key names of top clients on his first day with the firm, one of which was the New Yorker. Key’s relationship with Krieger and other traders at Bankers Trust in New York were credited with turning the New Zealand branch into the number one forex trading room in the country.
It is this well documented working relationship between the two that rips some serious holes in Key’s (and that of ex-colleague, Paul Richard’s) 1990s statements to the SFO – namely the date of a ‘lunch’, the reason for it, and indeed, if there ever was one. Richards was facing fraud charges for his part in a series of fictitious foreign exchange transactions between high flying New Zealand company Equiticorp and Australia’s Elders IXL, the trades came to be known as the ‘H-Fee’ transactions.
In November 1990 Richards told the SFO investigators he could remember a ‘lunch’ on 31 August 1988 as it was his friend and colleague (John) Key’s farewell – Key was leaving Wellington based Elders Merchant Finance for a position with Bankers Trust in Auckland. The date for the lunch was in contention as it differed by some days from the recollections of Richard’s co-accused.
In May 1991 it was Key’s turn. He corroborated Richards’s evidence and assured investigators he too could recall the lunch they had had and events during it, telling the SFO he had resigned from Elders on 24 June 1988 and was immediately put on gardening leave. The lunch with Richards was on his last day, 31 August 1988, and he was leaving for Auckland immediately to start work with Bankers Trust.
However Krieger had resigned from Bankers Trust on 23 February 1988, some six months before Key and Richard’s alleged ‘farewell’ lunch. Is Key’s well documented working relationship with Krieger merely a fabrication? Although it would be pretty hard at this stage for even the most accomplished of spin doctors to claim Key did not work with him, though I’m sure some will try.
So I once again find myself asking – because, as Hooton so succinctly put it – “they both can’t be right”….
“John Key did you (conspire to) lie to the Serious Fraud Office?”
Politically Corrected NZ 
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