Phillip Smith is likely to have had outside help in planning his escape to Chile while on temporary release, police say.
He may also have been planning his escape for years, authorities say.
Smith left by plane for Chile on a passport previously obtained in his birth name, on the afternoon of Thursday, November 6, the day he was temporarily released from Springhill Prison.
Corrections and Internal Affairs have been working with police on the inquiry.
The circumstances of Smith obtaining the passport under the name Traynor and making arrangements to leave, and who may have assisted, are the subject of an inquiry, police said.
FROM THE ARCHIVE:When Smith was caught running mail order business from jail
The passport was valid, and therefore there was no reason to stop him at the border.
Smith had undertaken a number of release visits, understood to be 10, as part of his release plan. He had been due back at Springhill prison on Sunday but police were notified on Saturday that he had not turned up at his sponsor's home, as arranged last week. There had been no warning signs on previous visits.
Police had, through Interpol, notified Chilean authorities and all avenues would be pursued to return Smith to New Zealand, police said. His victims were advised this morning of the latest developments, and were being supported by police and Victim Support.
At a press conference this afternoon, police Assistant Commissioner Malcolm Burgess and Corrections' Jeremy Lightfoot were asked what checks were in place to monitor prisoners.
Phillip Smith fled the country on a passport under the name of Phillip Traynor
Mr Lightfoot said Corrections' system of checks and balances had not failed, despite the escape. "I think this is a hugely disappointing and distressing event for...the victims and their families."
Mr Lightfoot said an operational review was underway but it was too soon to say if any Corrections staff would resign over the escape.
Police believed Smith passed through Customs alone and were combing through vast amounts of CCTV footage from Auckland Airport.
Mr Burgess said he was confident Smith would be caught if he drew the attention of Chilean authorities but South America was "a big place" and there were no guarantees he'd be caught.
He said it was likely government agencies would discuss how to better share information to prevent a similar situation happening again. "Whether it's a failure or a cock-up . . . those are things that hopefully the inquiry will establish."
Police had no plans to send any officers to Chile at this stage.
He said the obvious reason Smith chose to fly to Chile was because it was a direct flight.
Mr Lightfoot said Smith's sponsors were vetted. One was a female relative and he refused to disclose detail about the second sponsor.
He also acknowledged the distress Smith's escape caused the family of his victims.
He said Smith was previously given six temporary releases for up to 12 hours at a time.
There were no untoward incidents during this time so Smith was able to convince the Parole Board he was "making progress". Mr Burgess, however, said it was possible Smith planned his escape for months, even years.
Mr Lightfoot said Smith was also recently allowed to leave prison for 24 hour and eventually 72-hour periods. He fled when on the second of his 72-hour breaks.
"Obviously I'm very disappointed this event has occurred given the significance of Mr Smith's offending," Mr Lightfoot said.
He said there had been a "planned and careful" process for re-integrating Smith.
Corrections realised Smith was missing only on Saturday afternoon, when it contacted Smith's sponsors.
Mr Lightfoot said the sponsors were supposed to inform Corrections as soon as Smith absconded.
Police Minister Michael Woodhouse and Corrections Minister Peseta Sam Lotu-Iiga said an urgent review was underway. "The circumstances leading to Phillip John Smith (Traynor) obtaining a passport and later absconding are the subject of multiple investigations involving police, Corrections and the Department of Internal Affairs," Mr Woodhouse said.
Mr Lotu-Iiga spoke to Corrections chief executive Ray Smith to ensure the review got underway immediately. "This situation is unacceptable. We need to find out what went wrong and fix any shortcomings," he said.
"We acknowledge the distress the prisoner's escape has caused his victims and their families, and can assure them every effort is being made to locate and arrest this prisoner as soon as possible."
Mr Woodhouse said police were working closely with Chilean authorities via Interpol and agencies would strongly pursue all avenues to return Smith to New Zealand.
"Right now, our number one priority is ensuring Police work with their international counterparts to trace and recapture him. The second priority is for departments to urgently look at what went wrong, and where things need to be improved. That work is already underway.
"While each agency will rightly investigate its own handling of this situation, clearly there have been a number of failings. The Government is seeking advice on a broader inquiry into those failings.
"I'm expecting advice on what form such an inquiry may take and will be discussing the options with my colleagues," he said.
1974 - Born Phillip John Traynor
Circa 1986 - Met victim's family in Carterton.
1992-95 - Sexually abused his neighbour's son.
1995 - Murdered the father of the boy he was abusing while on bail for extortion, and escaping police custody while on bail for earlier offending.
April 15, 1996 - Sentenced to life, with a minimum non-parole period of 13 years, for murder, sexual offences against his victim's son, aggravated burglary of the family's home and kidnapping of the victim's wife and son.
April 14, 2009 - First time Smith is eligible for parole. Parole Board addresses multiple frauds committed in prison between 2006 and 2010. Investigation begins in to a business he was running behind bars and other fraudulent activity.
February 4, 2011 - Appears before Board again. The Board raises concerns about the "violent callous and manipulative aspects of his offending".
May 3, 2011 - Appears before the Parole Board, which orders a Parole postponement of two years.
April 8, 2013 - Parole postponement lifted and parole declined. Smith begins having 12 hour temporary releases.
March 31, 2014 - Smith is denied parole again. The Parole Board identified his risk of reoffending as high, and that if it were to occur it would likely be in the form of fraud. Board recommends further temporary releases.
Thursday, November 6 - Smith is collected from prison by an approved "sponsor", a family member. That same day he leaves the country using a passport in the name Phillip John Traynor and flies to Chile.