A private investigator has been called in to determine how Tainui used some of the $1.3 million the Corrections Department spent consulting with Waikato iwi over a prison development.
Forensic accountant Dennis Parsons, of Indepth Forensic Ltd, will lead an investigation into the tribe's handling of almost $600,000 of Maori consultationcontracts paid by Corrections as part of its new Springhill prison development at Meremere.
It was part of the $1.3 million the department spent consulting with Waikato iwi.
Tainui co-chairman Tuku Morgan was originally tasked with heading the investigation, called after a special executive meeting earlier this month. However, Mr Morgan has stepped aside from heading the investigation.
A source on the tribe's executive said tension between Mr Morgan and fellow co-chair Haydn Solomon, whose involvement in the contracts will be scrutinised, brought the reliability of an investigation led by him into question.
The special meeting followed more than a week of revelations led by ACT MP Rodney Hide.
Mr Hide called on Corrections Minister Paul Swain to call in the auditor-general to investigate how Corrections spent $1.3 million on Waikato iwi consultation.
He quoted a June 2002 memo written by the then Waikato Raupatu Lands Trust services manager David Gray, which said the only interests being protected in the department's contracts were those of Tainui's co-chairman Haydn Solomon, a Corrections consultant and former Tainui trust worker, and "a couple of his mates".
Tainui's two full and one part-time staff members were suspended on full pay after the meeting.
A move to oust Mr Solomon, expected at the special meeting, foundered because insufficient notice ahead of a board meeting was given.
Mr Morgan did not return calls.
Waikato Raupatu Lands Trust chief executive Hemi Rau said it was important staff and the executive remained independent of the investigation.
He said it would be months rather than weeks before the results of the investigation were known.
Mr Parsons said due to the nature of the work it was inappropriate to comment.
