The December 2020 decision of the Serious Fraud Office to close the investigation into Lianne Dalziel's false election expenses return raises more questions than it answers. The Christchurch Mayor was challenged by Keep Our Assets Canterbury (KOA) Mayoral candidate, John Minto, over her 2019 election expenses return. In her declaration of donations Dalziel had failed to list donors who gave over $1500 to her campaign as required under electoral legislation. Instead, Dalziel put all donations from an auction into one donation of $40,000 from her husband, the late Rob Davidson, who had organised the auction.

When challenged, Dalziel firstly said no-one at the fundraising dinner had paid more than $1500 above the market value for the wine which was auctioned. However, this explanation unravelled quickly as media reported big money was paid for cheap plonk bought by Dalziel's husband. Dalziel finally produced a list of six donors and filed an amended expenses return showing:

Wei Min Lu ($17,850 donation)
Yong Jiu Chen ($3920 donation)
Zhi Cheng Tan ($2800 donation)
Jianping Wang ($2350 donation)
Grandland Investment/Bing Chen ($2950 donation)
Yang Xia Wu ($1750 donation)

In her defence Dalziel said she wasn't aware she was required to list these donors - a laughable excuse from someone who has run in so many national and local election campaigns. It seems clear she didn't want to reveal the names because she was worried it was not a good look in conservative Christchurch for all her major support to come from the Chinese community.

KOA made a formal complaint to the local electoral officer about her false return. She subsequently passed it to the Police who, in turn, passed it to the Serious Fraud Office. The SFO took nine months to make the announcement they had found "no evidence of any criminal conduct" by Dalziel. For a successful prosecution the SFO would have to prove "intent" to file a false return which they said they were unable to do.

Should Have Been Tested In Court

I think the SFO should have tested Dalziel's explanation in court. It should also have presented evidence to the court of several of her donors involved in controversial Council policies for example:

• The contentious Council bailout of the Christchurch Adventure Park in early 2019 (it had been damaged in Christchurch Port Hills fires in 2017) in which one of her donors is an investor.
• The involvement of one of her donors in a water bottling proposal - water bottling is hugely divisive in Christchurch and Canterbury.
• The property developments of several of her donors in a situation where there are large ratepayer subsidies ($8 million over five years 2013 to 2018) for residential developments in the central city.

How is it possible to hold elected officials to account for conflicts of interest if we don't know who is making big donations to their campaign? The SFO did none of this but said they thought the wording of the Electoral Act should be amended to provide more details about donations made through auctions. In its media statement the Director of the SFO, Julie Read, said: "It is in the public interest that allegations of electoral funding fraud be treated seriously and given due attention. In a representative democracy, voters must have confidence that those who make electoral donations do not unduly influence Government decisions".

A fair comment but the SFO's "once over lightly" investigation into Dalziel's hidden election donations leaves one shrugging one's shoulders. It's worth recalling here the changes to electoral law which we sought at a Select Committee hearing 18 months ago. The hollow SFO decision means they are more important than ever.

Changes Needed In Electoral Law Should Be Along These Lines

1. A Council employee, the local electoral officer, should not be expected to hold the Mayor to account for breaches of electoral law. Breaches should be dealt with by the Electoral Commission.
2. Only New Zealand citizens or permanent residents should be able to contribute to local election campaigns (foreign donations are effectively banned for national elections after legislation was passed in late 2019 but not for local body elections).
3. It is often unclear who the people are behind a donation if it comes through in the name of a business. Only individuals should be permitted to contribute to election campaigns.
4. The penalties for non-disclosure of donations are not a deterrent to candidates skirting the law. They need significant strengthening, so candidates take them seriously.
5. The current donation limit of $1500 after which donors should be identified should be lowered to $50.
6. Donors to campaigns should be identified publicly at least a week BEFORE the election rather than after. Big donations would not be allowed to be received in the last week of a campaign. This was important in Wellington for example where a single major donor, Peter Jackson, had a dramatic impact on the 2019 Wellington Mayoral campaign. In the Wellington case the public found out about the donation before the election but in Christchurch the two leading Mayoral candidates refused to name their donors before the election when approached by the media.
7. All candidates should be required to ensure actual addresses are provided rather than local "addresses of convenience" (in at least one case a candidate living overseas provided a local Christchurch address for the expenses return).