Editorial: America's Cup, Team NZ questions need answers

Emirates Team NZ claims to have uncovered a fraudulent transfer of funds to a Hungarian bank account, but not soon enough to foil the perpetrator. Photo / ETNZ, file

Editorial

EDITORIAL

In sailing terms, reading the direction of the wind and navigating myriad sea conditions is key to success on the water.

Issues occur when the situation doesn't match predictions, and a crew must be agile enough to make changes without losing unnecessary momentum.

Read More

• America's Cup - Team NZ spy allegations: Grant Dalton on confronting the mole - NZ Herald
• America's Cup: Govt concern at Team NZ financial management, threat to withhold funding - NZ Herald
• America's Cup: Team NZ hits back at claims of financial mismanagement - NZ Herald
• Team NZ, America's Cup in investigation over public money, Hungarian bank account and on-water safety - Grant Dalton says team was defrauded - NZ Herald

Emirates Team New Zealand (ETNZ) is now in unpredicted, and seemingly less than favourable, conditions. Questions over public monies require the organisation to respond to such a degree that allays public and Crown concern.

Team NZ has denied any impropriety over allegations involving a $3 million payment from America's Cup Events (ACE) to the team, and a large, separate amount of money deposited - accidentally - into a scammer's bank account in Hungary.

The details of the payments are contained in a confidential Auckland Council and MBIE letter to ACE and Team NZ, and the two public agencies are certainly concerned about financial management of taxpayer money.

Sufficiently concerned, in fact, that Crown has warned it could withhold the next tranche of taxpayer funding, according to the confidential letter obtained by the Herald this week.

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Auckland Council and the Ministry of Business, Innovation and Employment say a financial presentation in May - showing public spend - was "materially different" from that presented earlier in the year.

The public interest here is as obvious as a mainsail in full batten. The council and the Government have poured $250m into hosting the 36th America's Cup - and the council is planning to spend a further $20m to support the regatta and other events next year.

The council's share of the $250m is $113m, while the Government is spending $136.5m, including a host fee of $40m.

Economic Development Minister Phil Twyford's office has confirmed he too was aware of the allegations. He, also, should now state what is being done to ensure the integrity of public investment so far and ongoing into next year's regatta.

"Contractual and commercial sensitivities" have been cited as reasons the public cannot have some answers. For the sake of public confidence - essential for continued support for Emirates Team New Zealand and the America's Cup regatta - those with the answers need to open up fully.

The allegations swirled to the fore after Team New Zealand boss Grant Dalton hoisted a protest flag about "informants" in the event's organisation leaking information and "spreading inaccuracies".

Yesterday, Dalton said some of the allegations were resolved with the Ministry of Business, Innovation and Enterprise but others were still being "knocked off, one by one". He said his organisation had been defrauded, with money being paid into the Hungarian bank account. He says the loss of the money was reported to the police and Kiwibank.

Questions remain over how an enterprise such as ETNZ can be scammed and by whom; what, if any, money has been recovered; how confident is ETNZ that this won't happen again; what was the $3m worth of "event work" provided by ETNZ; and whether the public can be confident its money is fully and consistently accounted for.

For the sake of momentum and continued public support, it's time to front up in order to meet any shifting tide of concern around this marquee event for New Zealand's recovery from the Covid-19 pandemic.