Act leader David Seymour says the latest spying and fraud claims to hit Emirates Team NZ and the America's Cup wouldn't be concerning if taxpayers' money wasn't involved.

Team NZ and America's Cup organisers are at the centre of an inquiry commissioned by the Crown over the spending of public money, including allegations of a "reclassified" $3 million loan and claims of fraud involving a Hungarian bank account.

A June 22 letter written by the Ministry of Business, Innovation and Employment and the Auckland Council reveals allegations around the handling of public money; the operation of the Cup itself and worries about public safety; and officials' concerns that the event organisers, America's Cup Events (ACE) and Team NZ, are in breach of obligations.

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Team NZ boss Grant Dalton has denied any impropriety and said that the organisation had been defrauded by scammers, with non-taxpayer money sent to Hungary. He denied there had been any $3m loan to Team NZ.

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Seymour told the Herald the event was the "greatest circus on Earth", but taxpayers' money shouldn't be spent on it - or on Team NZ.

Act Party leader David Seymour says the latest allegations are a reminder that the America's Cup is the greatest circus on Earth. Photo / Mark Mitchell
Act Party leader David Seymour says the latest allegations are a reminder that the America's Cup is the greatest circus on Earth. Photo / Mark Mitchell

"None of this would be a story if it was just some billionaires trading barbs and dirty tricks like they always do in the America's Cup.

"Personally I think the America's Cup circus is absolutely fantastic. I just don't want it funded on the day the Government is putting up Road User Charges on every truckie in the country so it can give money to sailors."

The Government is spending $136.5m - including a $40m host fee - into hosting the 36th America's Cup.

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The latest spying and misspending of public money claims wouldn't normally concern him, Seymour said.

"People make mistakes, but once you get taxpayers' money involved ... As soon as you take money off someone and give it to someone else, guess what, that person is not as careful with it as the person who earned it.

"I love the America's Cup. I just don't see why taxpayers' money should be funding it."

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He said it was right that the Government, through MBIE, was now looking into the claims.

He said there was a conflict of interest for the Government and "they shouldn't be subsidising the circus in the first place".

Emirates Team New Zealand chief executive Grant Dalton says no public money has been misused. Photo / Available
Emirates Team New Zealand chief executive Grant Dalton says no public money has been misused. Photo / Available

The MBIE and Auckland Council letter outlines "serious matters" raised by a financial investigation firm commissioned by the Crown to look into the financial management of next year's America's Cup in Auckland.

Among the concerns and allegations are:

• "ACE has used part of the Event Investment for costs that have arisen but which are not in relation to the management and delivery of the Events";

• "This includes the $3,000,000 loan to ETNZ which was subsequently reclassified and the payment that was made to the Hungarian bank account through fraud";

• "Lack of record-keeping and unwillingness to provide the information that has been requested";

• "Material relationships with third parties that are not documented and which can be terminated ... upon 30 days' notice";

• "Poor governance including suggestions that records should be retrospectively amended".

Grant Dalton told Newstalk ZB this morning said Team NZ had been scammed and had sent money to the wrong bank account in Hungary.

"I did not check the noughts and the ones on the bank account. It was the correct invoice as per the contract and the money was sent to Hungary.

"Instantly we rang MBIE, told them what had happened, told them it wasn't government money because it wasn't, and we got straight into the fraud police... and we've recovered some of the money.

"We were defrauded by scammers. Police don't know yet and probably will never know [who they are]. Some of the money is back. In the end... the ultimate noughts, ones, whatever, numbers on the bank account... weren't checked."

Dalton said there was no $3m loan to the team.

"And secondly the amount to the Hungarian defrauded bank account wasn't that figure. There's a tie-in of three things which don't relate to each other. There's never been a loan to Team New Zealand from the event, never."

Earlier Dalton said that Team NZ had ended a contract and claimed "spies" were caught leaking confidential information and spreading "inaccurate allegations".

Economic Development Minister Phil Twyford said the purpose of the MBIE review was to see if public money has been used appropriately.

He indicated the Cup would go ahead as planned.

"MBIE has advised today that Cup planning is continuing along original timelines."