David Zhang says he would rather burn money than donate it to the Labour Party.
“I do not like the Labour Party,” the Mt Wellington scaffolder told the High Court at Auckland when asked if he recalled getting a receipt from Labour’s then general secretary Andrew Kirton thanking him for the purchase of an $8000 painting and helping to change the government in 2017.
“I will not donate to the Labour Party. It’s just not possible,” he said in denying seeing Kirton’s message.
Seven people are on trial for obtaining by deception in relation to party political donations. One, former MP Jami-Lee Ross, faces charges over separate $100,000 donations to National in 2017 and 2018. Three, Auckland businessmen Yikun Zhang, and twin brothers Colin and Joe Zheng, face charges over both National and Labour donations, and three other defendants whose names are suppressed face a charge connected to the Labour artworks donation.
The Crown has begun the case by examining that Labour donation. It says the full donation was made by Yikun Zhang and arrangements were made with Zheng and Zheng and defendants involved with Labour to keep his identity from public view by breaking the total into smaller amounts ostensibly from others claiming to have paid for the artworks.
Crown lawyers have called three witnesses who were ‘purported purchasers of a painting’.
The paintings were originally bought from an Ohope art shop by one defendant. They were then offered to Yikun Zhang and put up at a ‘silent auction’ within the Chao Shan General Association, a Chinese community group, raising a total of $60,000 – from $16,000 down to $8000 for the various individual works. Because the art was already valued at $25,000, that value did not count as a donation to Labour. If individual donations fall under a $15,000 threshold they do not need to be declared, or have the donor identified, to the Electoral Commission.
Witness David Zhang’s name was one of five supplied to the Labour Party by one of the defendants after the auction.
He told Justice Ian Gault, who is hearing the case alone, that he was “just a scaffolder, I don’t know anything about art”. He had never bought a painting at an auction nor had a conversation with anyone about buying a painting.
He said he was a close friend of Joe and Colin Zheng through their work in construction and knew of Yikun Zhang, but was not “familiar with him”.
Crown lawyer John Dixon QC pointed Zhang to a Chinese language text message from Zhang’s phone in February 2020 confirming to another person that the painting had been received. “The money for the last event auction has been given to President Zheng [one of the defendants]. The painting has been received, thank you.”
Zhang said he did not send that message. “I’ve never purchased any paintings. It is not possible.” Asked again if he had sent it, he said “I can’t remember. It is a very long time ago”.
However he did accept the defendant Joe Zheng had helped him when Zhang’s mother was ill just before the first Covid lockdown in early 2020 to send messages on Zhang’s phone to health officials about hospital appointments. “Joe used my phone but I’m not sure if he sent that message.” he told Dixon.
Another ‘purported purchaser of a painting’, Cuong Thu Tu, also knew Yikun Zhang and Colin and Joe Zheng through the Chao Shan Association. He also knew of one of the other defendants in the Labour donation part of the case.
Tu denied ever donating to Labour or buying a painting. “Normally, for those kinds of events I wasn’t present,” he told Paul Wicks, QC for the Crown. When he was interviewed by the Serious Fraud Office in 2020 about the total funds raised from the art sale of $60,000 it was the first he had heard of it.
Tu was listed to the Labour Party as buying a painting for $12,000.
An email from one of the Labour defendants to Kirton in April 2017 said of the receipts: “It would be great if you can bring the original copies on Friday dinner at Zhang Yikun’s.”
The purchaser names sent to that defendant from Joe Zheng said: “Name list for donation, from Colin.”
Wicks asked Tu: “Do you know why your name is on that list?”
But he accepted that another defendant, whose name is suppressed, had called him in March 2017 and “basically it was mentioned that my name was required… I did not say anything. If my name is required, then do it”.
Tu also claimed a text from his phone to that defendant in February 2020 saying “President … Labour Party auction painting. I have received it. Tu Thu Cuong” was not sent by him.
A letter carrying the names of the purported painting purchasers, including defendant Joe Zheng, to Labour in 2020 after controversy arose over the donation was presented to the court said:
“We were the five people who bought the artworks from Labour in early 2017 to support your party.
“We were approached by your party from Wednesday about the process of the artworks. We can collectively confirm that we bought the artworks, collected them respectively and paid Mr Zheng for him to transfer the total amount of $60,000 to your party’s account.
“We supported your party in good faith. However, we do not wish to get involved in any political parties in such a manner. The best way to resolve this matter is for you to return the money to us and we will return the artworks to you. Let us know when you are going to do this.”
Tu said he was not shown that letter and had no involvement in creating it.
Sam Lowery, representing one of the defendants with name suppression, asked Tu if his client had called him asking permission to use his name.
“Yes, name was discussed.”
After a short conversation Tu thought about the request and agreed. “It was not a big deal.”
Lowery: “Did he say your name was needed to skirt or avoid electoral law?”
“No, I do not know anything about that. I did not have suspicions about this.”
When pressed on that conversation Tu told the lawyer: “I do not want to be pushed and asked questions. If you push me, I will stay silent.”
Tu also denied seeing a receipt from the Labour Party’s Andrew Kirton.
The defendant Yikun Zhang, through his counsel John Katz QC, has already told the court it was not disputed that it was Zhang who made the donation to Labour for the artworks. The Labour Party’s 2017 donations return to the Electoral Commission was apparently wrong but that was not Zhang’s issue.
The Crown’s opening statement said SFO investigators photographed the paintings at Zhang’s Remuera home when executing a search warrant.
It also said the payment to the Labour Party from Joe Zheng was made three days before the purchasers claimed an auction occurred. “The Crown case is that no auction occurred. It was all a ruse.”