Guns, ammunition, methamphetamine and bundles of cash have been discovered in a dedicated facility in Auckland for defendants on bail while facing criminal charges.
The Ahikaa Trust provides accommodation for up to 12 individuals who would otherwise not have a suitable address for bail, or parole, where they can also receive counselling for drug and alcohol abuse.
The use of the building in central Auckland was gifted to the trust by Mark Lyon, the property developer sent to prison for sexual crimes against young women at the same address, and the facility was opened by distinguished guests four years ago.
More than 100 defendants have been kept out of prison since then, according to those running the rehabilitation programmes, although police and probation officers have also raised concerns about residents with gang and drug links living together while on bail.
The services provided by the Ahikaa Trust are now likely to come under closer official scrutiny after police raided the converted apartment block on Karaka St in central Auckland.
Officers found bundles of cash, ammunition and three firearms - including one military-style semi-automatic with a silencer - concealed in a communal space at the facility during a search warrant executed last week.
No one was charged over the cache of criminal goods. But a 31-year-old member of the King Cobra gang living at the bail accommodation was charged with possession of methamphetamine for supply, and failing to assist a constable acting in his duties.
A media spokeswoman said Police National Headquarters was unable to comment without a privacy waiver from the Ahikaa Trust.
A photograph obtained by the Herald shows the firearms and cash seized.
"It is deeply concerning that alleged offenders are being sent to a bail and reintegration facility by the courts only to find that military-style weapons, drugs and cash are being recovered by police," said Mark Mitchell, the National Party spokesman for police.
"It's unacceptable. If any taxpayers' money is being used to fund this facility then there are some serious questions that need answering."
Minister of Corrections Kelvin Davis said it was "disappointing" the firearms were allegedly discovered at a place that provides accommodation for those who are eligible for bail, but have nowhere else to go.
"This type of accommodation is an important cog in the justice system but should be run appropriately and safely."
Davis distanced himself and his department from the Ahikaa Trust by pointing out there was no formal relationship or contract.
The incident would also be noted on any future bail application, said Davis, and Corrections staff would ask the bail accommodation facility to provide more information on its security and monitoring in bail reports.
"But again, that is for a Judge to decide," said Davis.
Davis and fellow Labour Minister Willie Jackson appear in a photograph posted online by the Ahikaa Trust, which a spokesman said was during the 2020 election campaign.
Elaine Ngamu is a director of the Ahikaa Trust.
Her husband was a co-director at the trust but since his death earlier this year, Ngamu said she had not been working at full capacity.
Jailed more than a decade ago for her part in a scam where $500,000 in cheques was stolen from mail boxes, Ngamu has long been an anti-meth crusader and worked in drug rehabilitation.
Given the discovery of guns and drugs at the bail house, Ngamu acknowledged changes may need to be made at the facility.
"I think I just need to check everything, make sure everything is robust and look at oversight, maybe hiring some different staff."
Ngamu said police had told an Ahikaa Trust supervisor that the firearms had been found in a common area.
She understood the methamphetamine was allegedly in the room of the man charged in connection with the raid.
He had been at the facility for almost a year and had been moved to a different part of the building because he wasn't getting along with someone on the upper level, she said.
Ngamu said they would not take the man back were he to apply for bail again.
"He's been doing really well, but he does suffer from some mental health issues as well.
"He is a lovely guy, but you know, it's an addiction, it gets a grasp of people and sometimes refuses to let go."
Ngamu said the Ahikaa Trust had previously suffered what she described as "some hiccups" but they had worked hard to implement counter-measures such as security cameras.
Their clients would not receive bail without the Trust's support, she said.
"We do work with … the hard to reach, the hard to treat and the hard to deal with."
Ngamu acknowledged Wednesday's raid could affect the willingness of the courts to bail people to the Karaka St facility.
"It may do, but we'll come up with a management plan."
She believed it was better to have high-needs people on bail at Ahikaa Trust where they would get help, rather than living unsupported in apartment buildings, or elsewhere in the community.
Tenants at Ahikaa receive the accommodation supplement from Work and Income New Zealand, which goes to the trust to fund its running costs and rehabilitative programs. The Ministry of Social Development said it had no contractual relationship with Ahikaa and it had given no grants to the Trust.
Ngamu said she receives no money from Corrections or Police.
The Eden Terrace building where the Ahikaa Trust clients live has a dark history.
The rundown apartment block called 'Artizanz' was owned by Mark Lyon, a successful property developer whose life spiralled out of control because of meth addiction.
Girls as young as 14 would be lured back to the building and plied with drugs, then pressured for sex.
One victim was shackled by a collar to a metal pole in a part of a building called the "dungeon" and forced to perform a sex act on Lyon.
He was arrested in 2012, and Ngamu said she was asked by his defence lawyer if Lyon could be bailed to another address operated by the Ahikaa Trust.
"He became one of our first clients," said Ngamu
After Lyon was convicted in 2015 and sentenced to 15 years in prison, Ngamu said a lawyer approached the Ahikaa Trust about the possibility of taking over the notorious Karaka St building.
Lyon was a director of the Ahikaa Trustee Company from 2013 to 2016, Companies Office records show. No rent was paid to use the building, which Ngamu said freed up more funds for drug programmes.
This arrangement is uncertain following his death.
"You know, if a building like the so-called 'Hotel California' Artizanz building, with that bad reputation, if we could change that, it's like sending a message to those people that are heavily entrenched in that meth-using world that if a building can change, so can you," said Ngamu.
"We've got to deal with the history of that place every day really."
Council valuations show Ponsonby properties fell 14% from $2.65m to $2.27m.