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d a police officer who was paid 70 000 by an organised crime group to share sensitive information from the police database 14 the report said new zealand is more susceptible than ever to corruption at our borders and that this is an increasing threat a majority of interceptions of drugs at our ports and airports involve trusted insiders helping to retrieve concealed shipments before customs inspects them consistent with an unpublished global report which estimates that 70 of maritime seizures worldwide involve insider cooperation 15 business related fraud edit however in business related fraud a report by kpmg in 2012 found that only 17 of perpetrators are employees or insiders within the victim organisation including both management and non management staff 16 fraud has been committed in local councils transport authorities educational institutions government ministries and by business consultants notable public sector examples include council employees manipulating procurement processes senior managers in government agencies and individuals in leadership roles at public entities 17 kpmg said that around 84 of perpetrators in business related fraud are external parties or outsiders such as vendors customers or third party suppliers these external actors often engage in procurement fraud cyber enabled fraud and large scale scams the national cyber security centre reported that in the first three months of 2025 more than half of the financial losses from scams were suffered by businesses especially those handling large financial transactions such as law firms and real estate agencies in 2024 scam losses came to nz 25 7 million up 40 from nz 18 3 million in 2023 however independent estimates suggest that the true annual cost of fraud including unreported incidents could range from nz 200 million to nz 2 billion 18 tax evasion and tax avoidance edit tax avoidance new zealand loses significant sums of revenue through legal tax avoidance mechanisms especially through multinational corporations shifting profits offshore for example in 2023 about usd 167 6 million in tax revenue was lost this way the tax justice network wants an end to global tax abuse that deprives countries of tax revenue 19 tax evasion tax evasion is a subset of avoidance that is illegal figures from inland revenue show that in the first half of the 2024 25 financial year audits uncovered 600 million in additional tax that should have been declared suggesting the annual total of taxes evaded by new zealanders would be in the vicinity of 1 2 billion only 60 80 tax evasion cases are prosecuted each year targeting just 0 01 of taxpayers this reflects the often complex and less visible nature of such offending 20 at the end of 2024 new zealand s tax debt including overdue unpaid and evaded taxes across all sectors stood at 8 5 billion a significant increase in prosecutions means inland revenue is on track to collect over 4 billion in overdue and evaded taxes for the financial year ending june 2025 21 benefit fraud in comparison most benefit fraud in new zealand is relatively small and the majority of benefit fraud cases involve overpayment recovery rather than criminal prosecution in the 2021 22 year 4 638 cases of benefit fraud were investigated but only 33 resulted in criminal prosecutions with 2 4 million identified as total overpayments 22 however the overall scale of welfare fraud in new zealand is in the range of 10 20 million per year although overpayments may not necessarily be the fault of the recipient in the year ending june 2024 the ministry of social development recorded 1 092 completed benefit fraud investigations resulting in a total of 12 24 million in overpayments for that financial year 23 personal victimisation edit according to data from the 2024 crime and victims survey fraud is now the most prevalent and fastest growing type of crime in new zealand accounting for around 29 of all crimes committed 24 recent research suggests that two thirds 67 of new zealanders have been targeted by online scams and one in three 33 have actually fallen victim 25 factors contributing to increase in fraud edit increased reliance on digital banking online shopping and digital communication platforms has created more opportunities for scammers and fraudsters to target both individuals and businesses from anywhere in the world the growth in digital asset investments has made people vulnerable to crypto investment scams which are harder to trace and regulate 26 business email compromise and unauthorised money transfers are among the fastest rising scams with high value incidents over 100 000 now being reported more frequently 27 scams and fraud schemes increasingly use social engineering psychological manipulation and even ai driven tactics to build trust and steal information or money 28 many victims feel shame that they fell prey to a scam and only about a third of victims report the incident at the same time regulatory and enforcement agencies are struggling to keep pace with rapidly evolving fraud strategies leading to a lag in effective prevention and response 29 potential political corruption edit undue influence of lobbyists edit a range of concerns have been raised over the access of lobbyists to members of parliament mps in new zealand unlike countries such as australia or canada the lobbying industry is largely unregulated and there is no dedicated watchdog or monitoring of lobbying activities lobbyists do not have to register disclose their clients or reveal their activities this has allowed new zealand to develop a revolving door whereby former politicians and ministerial staff move into lobbying roles after leaving government 30 for example kris faafoi a former cabinet minister became a lobbyist almost immediately after leaving politics 31 in 2024 former opposition national party leader simon bridges was appointed as chair of nzta by the national government raising concerns about whether such appointments undermine impartiality and integrity of the public service 32 this raises concerns about the misuse of privileged information and future employment influencing current official decisions and makes it difficult for the public to know who is influencing mps on critical issues fueling suspicion about potential backroom deals and undue influence by those with access 33 both the ministry of justice and independent observers have warned that excessive influence opaque lobbying and the appearance of mps trading favours behind closed doors threaten the integrity of new zealand s democracy 34 chumocracy edit auckland university economics professor robert macculloch believes that new zealand s economic prosperity is being hindered because top jobs in government agencies are being awarded to former politicians and connected insiders by the political party currently in power he says new zealand has become a chumocracy and that this blocks more deserving but non connected kiwis from aspiring to these roles contributing to the economic stagnation and the loss of living standards 35 politicians to illustrate his concern macculloch points out that after the 2023 election a number of sir john key era politicians were given high ranking jobs simon bridges was made chair of the waka kotahi paula bennett made chair of pharmac steven joyce was given the infrastructure advisory chair sir bill english was given the role of reviewing state housing and murray mccully was appointed to head an education inquiry 36 non politicians non politician vips appointed to important roles include former treasury secretary graham scott who finance minister nicola willis made chair of her social investment agency matt burgess who was a cabinet adviser under john key was returned to advise prime minister christopher luxon lester levy appointed by john key to chair the auckland district health board was appointed by chris luxon to chair health new zealand sir peter gluckman who was key s science adviser has been appointed to head the advisory group for the sciences and universities 37 examples edit lobbying by industry sectors has contributed to the adoption of light handed or weak regulation in areas such as finance and building standards with disastrous public consequences for instance the collapse of multiple finance companies since 2006 led to the loss of billions of dollars of investors money in 2011 this led to an overhaul of laws regulating finance companies and the creation of a new regulator the financial markets authority fma 38 the leaky homes crisis in new zealand producing costs of 11 billion estimated as half the true cost 39 has also been linked to lobbying efforts that prioritised industry profit over robust public protections 40 lobbying by particular industries especially in agriculture liquor hospitality and processed foods continues to shape policy outcomes for example efforts to introduce stricter alcohol and unhealthy food regulations have often been stymied or watered down due to lobbying pressure from these sectors 41 the tobacco industry has also been effective due to their links with the nz first party undermining new zealand s commitment to be smoke free by the end of 2025 42 opaque political donations edit concerns have also been raised about political donations from wealthy individuals and corporations which can grant privileged access and influence particularly in the absence of robust disclosure laws this further distorts the policy making process in favour of those with financial resources 43 high profile conflict of interest cases edit taito phillip field 2009 taito philip field a former labour mp and government minister was sentenced to six years in prison in 2019 for bribery and corruption related to accepting free labor from people he assisted with immigration matters 44 michael wood s airport shares 2023 as minister of transport michael wood failed to sell significant shares in auckland airport repeatedly ignoring official advice to do so despite making ministerial decisions affecting the airport sector this clear conflict led to his resignation and was cited as an explicit case of a minister putting personal profit ahead of public duty 45 stuart nash s donor dealings 2020 2023 while a minister in cabinet stuart nash shared confidential cabinet information with political donors who stood to benefit from government decisions and advocated for a donor and friend to receive government appointments this breached multiple ethical rules and demonstrating the misuse of public office for personal or associates gain 46 jami lee ross donation scandal 2018 2020 ex mp jami lee ross was implicated in helping facilitate donations of almost 200 000 to the national party the donations were allegedly split into smaller amounts to avoid disclosure requirements the incident caused significant reputational damage for the national party while no current senior officials were charged the scandal highlighted vulnerabilities in donation laws and prompted widespread calls for reform 47 new zealand first foundation scandal 2019 2022 the nz first foundation collected almost 500 000 in donations from various wealthy donors including those in food manufacturing racing forestry and property development these funds were used for party activities but were not properly disclosed raising accusations of using a secret slush fund and allegedly breaching electoral rules the serious fraud office sfo prosecuted although the trial ended without convictions due to technical legalities the court affirmed that the donations should have been disclosed under the electoral act 48 casey costello s tobacco industry advocacy as associate health minister casey costello has recommended and implemented policies that closely align with tobacco industry interests she ordered a 50 cut to the excise tax on heated tobacco products and repealed aspects of the smokefree legislation which would have banned sales of cigarettes to anyone born after 2008 these policies represent a cut in tobacco excise available to government of 1 6 billion a year and were implemented despite advice from health officials against it 49 costello has been widely criticised as mirroring tobacco company strategy documents 50 police misconduct edit the new zealand police are perceived to have a minimal level of institutional corruption the national organised crime group within the new zealand police has uncovered some corruption in government agencies and the private sector connected to criminal groups but systemic corruption within the police itself remains limited overall 51 however individual police officers have been involved in numerous controversies in recent years some of which may be perceived as involving corrupt behaviour see the list of new zealand police controversies historically there have been a number of wrongful convictions involving police misconduct such as the planting of evidence against arthur allan thomas in 1979 who was later pardoned and compensated after a royal commission found police officers responsible for framing him 52 since then police officers have been accused of manipulating evidence fabricating information pressuring witnesses to lie and using questionable investigative techniques in the pursuit of convictions strategies which have been described as noble cause corruption 53 since 2021 hundreds of police staff have been criminally investigated and the police national integrity unit continues efforts to deter and detect corruption within the force 54 prison issues edit the influence of gangs in prison and informal inmate control over prison economies have raised concerns about prison management but official reports suggest that direct corruption involving corrections staff such as bribery and smuggling are relatively rare 55 nevertheless in 2021 it was reported that 387 corrections staff were placed under investigation within a single year for issues including corruption smuggling contraband and inappropriate relationships with inmates 56 in 2023 six current and former corrections staff were charged after a three year police investigation operation portia into corruption and bribery offences involved smuggling contraband such as tobacco and food into the prison in exchange for cash payments to staff members by associates of prisoners one former corrections officer pleaded guilty to multiple bribery charges and admitted to delivering goods to prisoners in exchange for money with some transactions involving thousands of dollars 57 several senior staff including managers were suspended during the investigation and the case brought attention to ongoing vulnerabilities within the prison system in handling staff integrity 58 prosecuting agencies edit serious fraud office edit main article serious fraud office new zealand the serious fraud office sfo is the lead law enforcement agency for investigating and prosecuting serious financial crimes including bribery 59 and corruption in 2020 the sfo reporte...
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