Email trail ends in jail sentence for public servant

By KEVIN TAYLOR

Corrupt public servant Errol Noel Brassett's undoing was an email sent on April 26, 2001, to a former colleague at the Ministry of Economic Development.

A senior investigator in the ministry's trade remedies group, he had just resigned to run a trade remedies consultancy business after 14 1/2 years doing the job for government departments.

The trade remedies group investigates the dumping of cheap foreign goods on New Zealand shores and the impact on New Zealand business.

Its recommendations can lead to duties on imported goods that are dumped here too cheaply.

A vital component of the group's work is the collection of sensitive commercial information from businesses alleging dumping.

Brassett, 45, left the ministry on April 19, 2001, to start running his own company, TR Consultants Intl.

A few days later he emailed former junior colleague Sanjay Bhawan seeking an update on an investigation into Korean whiteware dumping in New Zealand.

He was involved in the probe before his resignation, a role that gave him access to confidential information from New Zealand's largest whiteware manufacturer, Fisher & Paykel.

But the email alerted the ministry that something was up. Why was Brassett asking questions about the case when he was no longer working for the ministry?

That, in the words of ministry chief executive Geoff Dangerfield, is how the whole case was unravelled.

A search of the group's computer system found Brassett had been sending official files home by email.

When police searched Brassett's Tawa home on May 4, 2001, they found 3500 electronic documents, some personal, from the trade remedies group. Of these, 660 were confidential.

Brassett had approached the Korean electronic industries association - before he had even left the ministry - offering to work as a consultant for the same whiteware firms whose exports were being investigated in the Fisher and Paykel case.

He approached the Saudi Arabian Government for work after it asked New Zealand authorities to help it set up a trade remedies division of its own.

He also had information on the importation of Chinese shoes, and documents relating to the production of a World Trade Organisation manual on anti-dumping investigations.

In the Wellington District Court yesterday, Judge Margaret Lee told Brassett she had no doubt that his consultancy business would have greatly benefited from possession of the documents, which he had no right to have.

Lee jailed Brassett for 18 months. The term was reduced from 2 1/2 years after pleas of mitigation from his lawyer, Richard Laurenson.

Leave to apply for home detention was granted.

A plea from Laurenson that the jail term be suspended temporarily so Brassett could help move his family from Wellington to Waitati, near Dunedin, was declined.

A first offender, Brassett was found guilty by a jury in December on eight charges, six of corruptly using official information to indirectly obtain an advantage, and two of making documents with intent to defraud.

He was found not guilty on 10 charges: six of corruptly using documents, three of making documents with intent to defraud, and one of theft of a ministry computer.

The judge said the sensitive commercial information Brassett took could have been "extremely detrimental" to New Zealand industries.

Some documents were so sensitive they were never even given to the jury.

Judge Lee said the offending put the ministry's reputation in jeopardy, and threatened to undermine its credibility and therefore its ability to carry out its statutory functions.

The trade remedies group's existence was based on the willingness of companies to provide it sensitive information.

"The ministry would not be able to function if that trust was lost. It was a gross breach of trust," the judge said.

"There should be no doubt in anyone's mind that similar offending by senior civil servants will be met by a severe sanction."

She rejected Laurenson's submissions that Brassett was naive and the offending was an "aberration" by a public servant with a blameless and dutiful 25-year career.

Laurenson urged that he not be imprisoned, saying he obtained no actual gain or advantage and had offered his apologies to the ministry.

Lee said while the case differed from other corruption cases because no bribe was taken and no financial gain was made, it did not make the offending any less serious.

Fisher & Paykel says the commercially sensitive information Brassett took could have been extremely damaging.

General manager of finance Mark Richardson told the Business Herald that the company just happened to get caught up in the case.

"We are very happy with the actions the ministry have taken to rectify the situation.

"We have every confidence in them."

The company supplied detailed profitability and pricing information to the ministry on a strictly confidential basis in relation to the Korean anti-dumping allegations.

The information was commercially sensitive and its disclosure to competitors either in New Zealand or overseas would have been extremely damaging.

"You are disclosing all your financial information, all your pricing information, all your cost information, so it is very confidential information," Richardson said.

The ministry refused to let the Business Herald talk to Brassett's colleagues.

Dangerfield said he could not comment on the sentencing, nor on Brassett himself because he had never met him.

But he said the case had cast a shadow over the whole ministry.

"The people who work here feel somewhat aggrieved that the hard work they put in and the professionalism they bring to the job might be brought into question by the actions of this person.

"This sort of behaviour is regarded as intolerable and that's why the whole issue was referred to the police when it was first uncovered."

Dangerfield said it was crucial to both individual firms and the country that sensitive commercial information not be misused.

"We can't do our job effectively in this area if the companies don't give us the information."

Security systems for the handling of sensitive commercial information in the trade remedies group had been reviewed by an outside agency and its recommendations adopted, Dangerfield said.

Asked if the case would have a lasting effect on the ministry's reputation, he said the fact Fisher & Paykel had said the case did not affect the way the company dealt with the ministry was gratifying.

"This is a one-off," he said.

Compared with some other countries, New Zealand seems lily-white when it comes to corruption. The latest Transparency International annual corruption survey, released last August, rated New Zealand and Denmark second equal out of 102 nations.

State Services Commissioner Michael Wintringham said corruption was rare among the country's 30,000 public servants.

But any such case was of concern because it undermined confidence in public institutions on a scale disproportionate to the offence.

The Government relied on the confidence of the citizens in institutions for voluntary compliance with tax laws and other regulations.

A corruption-free state and private sector were big contributors to a healthy economy and fair society.

Wintringham said corruption - the use of public office for personal gain - had to be distinguished from lesser offending such as theft as a servant.

"We have got a really good track record, and we have got to keep it that way," he said.

"Once it becomes entrenched, or you lose that, it's really hard to recover."

Wintringham said any public servant discovered behaving corruptly could expect to be prosecuted.

Business New Zealand chief executive Simon Carlaw said the Brassett case was a warning to other civil servants about how they treated sensitive commercial information.

New Zealand was fortunate in being relatively corruption-free, and the great majority of civil servants were careful.

"In 99-plus per cent of cases there is every reason to have confidence in the New Zealand bureaucracy."

Previous offenders

Corruption is rare among public officials in New Zealand. Errol Brassett joins a short, but growing, list:

* A former Auckland Inland Revenue official sold taxpayers' names, addresses and phone numbers to debt collectors who were trying to track people. Her actions between 1995 and 1998 cost the woman nine months in jail.

* In August 2000 a former Housing New Zealand employee was jailed for a year for accepting bribes totalling $57,000. His role included awarding tenders for maintenance work. One drainage company carried out $1.9 million of work for Housing New Zealand, mostly on an uncontested basis.

* In early 2001, two immigration consultants admitted their part in a cash-for-passports case.

* A Customs officer accepted cars, overseas trips and $100,000 for helping Singaporean gangsters sneak luxury stolen cars into New Zealand. He was jailed for four years in March 2001.

* A Work and Income Department case manager who sold confidential beneficiary information to a repossession agent and helped steal $30,000 was jailed for a year in March last year.