Lawyers for three men found guilty of trying to hide big donations to the National Party have argued for their convictions to be wiped.
A trial was held at Auckland’s High Court last year after the Serious Fraud Office alleged seven people helped to split large donations to the Labour and National parties into smaller amounts to hide the true donor.
Chinese businessman Yikun Zhang was found guilty of obtaining by deception in relation to a donation to the National Party in 2018.
Colin Zheng was found guilty in relation to two National Party donations in 2017 and 2018 and his twin brother Joe Zheng was found guilty of one charge of obtaining by deception and guilty of obstructing a Serious Fraud Office investigation.
The convictions came after National MP Jami-Lee Ross in 2018 publicly accused former party leader Simon Bridges of corruption in the party’s breaking up two $100,000 donations from Yikun Zhang, but Ross ended up being one of seven charged in an SFO prosecution covering both the National and Labour parties. While Zhang, Zheng and Zheng were convicted, Ross and those accused in the Labour case were acquitted.
During the trial Zhang, Zheng and Zheng denied the charges, and now all of them are appealing.
Lawyer for Zhang, Brian Dickey, told the Court of Appeal in Wellington the charge of “obtaining by deception” he was found guilty of was inappropriate because his client did not obtain anything by deception.
“Obtaining has to be done by the deception … the key is in the obtaining, the getting of.
“And what’s occurred in this particular case is there has been [as is the Crown’s case] an illegality in the disclosure regime of the Electoral Act … and we end up here going around in circles trying to see how we can make illegality under the Electoral Act work under the much much more serious construct of section 240.”
Later Justice David Collins asked Dickey if the charges could instead then be brought under the Electoral Act, or if too much time had lapsed.
“I don’t expect an answer now,” he laughed after a period of silence.
Transferring a conviction from one piece of legislation to another would be unlikely to satisfy the goals of the three men – particularly Zhang, whose lawyer John Katz KC argued the conviction in and of itself was disproportionate to his offending because it was stopping him from visiting his children in the United States.
“All three of their children have been sent to and reside in the US … the children were sent there because of, in particular, the door-stepping where the media would seek to speak to the teenage children in front of the home.”
He said having to declare a conviction would prohibit entry for Zhang to the US, and urged the court to change the penalty to discharge without conviction.
“[The question is] whether or not a conviction of this nature could be regarded as out of all proportion relative to the offence. In the circumstance there can be no question, but that.”
He said shame brought on Zhang as a result of the conviction was “far beyond what would be experienced by a Pākehā”.
The inability to visit his children was also disproportionate to the offending.
“The enormous personal impact on Mr Zhang and his wife in never being able to visit their three sons in the USA must be immense, especially for special occasions.
“A conviction will result in a denial of a visa.”
He said Zhang was willing to complete community service if the discharge option was seen as “too soft”, adding Zhang had made arrangements with John Tamihere to do work at the Waipareira Trust.
Lawyer for Colin Zheng, Don Lye, then told the court the High Court judge had not taken onboard social and cultural factors.
He said due to his Chinese culture Colin Zheng had an obligation to “repay” the National Party after it provided support to the Chao Shan General Association, of which he was the chairman.
“Those transactions perceived from Colin’s social-cultural worldview generated an obligation in him to repay.
“So when the National Party came knocking on Colin’s door, Colin had no choice but to reciprocate and to make the donations in the way in which the National Party asked him to [split up].
“What we say has happened here is there has been a legal error by the trial judge by taking only a Pākehā lens.”
Lye said these arguments around social and cultural context also applied to the conviction against Joe Zheng.
Smiley face or winky face?
Lye furthered his argument by adding there was no proof Colin Zheng knew it was illegal to split up the donation.
“Colin knew there was a disclosure threshold. That’s the only finding.”
He referred to an email reply from Colin Zheng to former National MP Jami-Lee Ross, who had explained the disclosure limits.
“Hi Jami-Lee. Thanks for your information, we will all follow the law [smiley face],” the email read.
“The only inference you can take is that he was actually intending to follow the law … The Crown characterises this smiley face as a winky face but it’s clearly not a winky face it’s just a smiley face.
“A winky face would have certain inferences.”
He added if his client really wanted to conceal the donation and knew what he was doing was illegal he would have likely taken further steps including using cash, and not characterising the bank transfers as National Party donations.
Another argument in the mix from lawyer Paul Dacre KC was that the result of the judge-alone trial had prevented a jury of Zheng’s peers from being responsible for the verdict.
“It’s unfair the advantages of jury trial were taken away.
Finally, lawyer for Joe Zheng, who was convicted of a separate charge of providing false or misleading information to the Serious Fraud Office, said there had been a miscarriage of justice.
Rosemary Thomson said the judge erred in his assessment of the evidence and Zheng had divulged the correct information during his interviews.
“The Crown referred to his story as ‘ever-changing’, it’s not ever-changing. He answered to the best of his ability.”
The Crown will present its submissions on Wednesday.