An urban Maori authority that gets most of its funding from the public purse paid $500,000 into and out of a lawyer's trust account controlled by chief executive John Tamihere on the day he settled the purchase of the family's $1.3 million Auckland home, according to documents obtained by the Herald.
The document recording the April 2008 transaction using money from the Waipareira Trust is headed Residential Land Purchase and gives the address for the family property.
It shows a "Te Whanu [sic] O Waipareira Trust advance" for $500,000 was paid into the "Tamihere Childrens Trust" held with Corban Revell lawyers on April 18, 2008. The money was paid out again the same day into an unknown BNZ account. That day was recorded as the settlement date for the house sale although the title did not change hands until May 7, 2008.
Mr Tamihere did not reply to messages about the payment and whether it was declared. Trust spokesman Joe Lose said emailed questions could not be answered "on legal advice".
The payment emerged during Herald investigations into the collapse of a housing development, in which Waipareira Investments Ltd invested and lost an estimated $2.5 million.
The development company, West Harbour Holdings, is in liquidation and involved in legal action with Mr Tamihere which is heading to court in June.
The legal action focuses on a loan to Mr Tamihere which is also linked to the purchase of the Te Atatu home.
The case focuses on who lent Mr Tamihere the money - West Harbour Holdings or, as Mr Tamihere claims, the company's director and former friend Brent Ivil.
Three weeks before the loan, the Corban Revell trust account received $500,000 from Waipareira Trust, the Herald has learned.
Liquidator Damien Grant, of Waterstone Insolvency, said the payment emerged during investigations into the property deal.
"We are aware that the Waipareira Trust appears to have advanced the funds to Mr Tamihere's trust."
Mr Grant said he believed the money had been returned to the Waipareira Trust.
The Waipareira Trust receives $14 million of taxpayer money to provide health and social services.
Financial accounts filed with the Charities Commission show no sign of the payment.
They also do not include the "notes to the financial statements" where "related party transactions" are usually recorded.
Waipareira Trust's accounts stated the absent notes are "an integral part of these financial statements" but offer no explanation for leaving them out.
A spokesman for Internal Affairs said the Charities Commission expected financial statements to comply with accounting practices.
Herald inquiries show the standard includes an expectation that "related party matters" are declared.
Ricky Houghton, who was a Waipareira Trust board member for 21 years and treasurer for 15 years, contrasted the payment with measures taken when he borrowed $30,000 for a truck.
He said the payment was made after a management report to the trust board, which voted on making the loan at a meeting at which he was not present.
He had to stand down from the board during the period of the loan, which was made at commercial rates and secured against his house.
It was fully disclosed in financial returns as a "related party transaction" - declaring the closeness of the arrangement, he said.