By EUGENE BINGHAM
A New Zealander linked to a bizarre plot to smuggle North Korean defectors to the West has run foul of authorities in China amid allegations he is working for the CIA.
Jack Sanders, who set up the Nauru Embassy in Beijing on behalf of the tiny Pacific country, was detained by authorities in Shanghai who had become suspicious about his activities, says a Nauru Cabinet minister.
Tony Audoa, the Minister of Education and a former Justice Minister, said Mr Sanders was released because he was carrying a Nauruan diplomatic passport.
"The passport sort of saved him," said Mr Audoa, who says Mr Sanders' activities have reflected badly on Nauru. "He is working for the CIA."
Mr Sanders, a middle-aged businessman who has lived in China about a decade, was linked to a covert smuggling operation by the Weekend Australian newspaper last week.
The newspaper said 11 countries, including New Zealand, had co-operated on "Operation Weasel" which had led to the defection of up to 20 of North Korea's military and scientific elite since October.
The operation was run at arm's length from the countries' Governments. Part of the plan was to set up Nauruan embassies in China and the United States to provide diplomatic cover for defectors, it was alleged.
The newspaper linked the Nauru operations to a Washington lawyer, Philip Gagner, an American called Steven Ray, and a New Zealander whom it said it had agreed not to name.
Weekend Herald inquiries have established the New Zealander was Mr Sanders, a red-haired expert of the martial art Woo Shu. It is understood he also goes by the name Jack Stubbs.
He moved to China initially to study the martial art in the city of Guanzhou and has since married a Chinese woman and had a child. Lately, he has had business interests in the city of Yanshuo, where it is believed he owns several hotels.
Sources in China said Mr Sanders had been involved with people from Nauru and they were aware he had applied to represent the island nation in Beijing as charge d'affaires.
His association with the embassy has caused problems with Chinese authorities who say the embassy has not yet been officially recognised.
A spokesman for the Chinese Foreign Ministry told the Weekend Australian: "We have some different opinions on the nominees for the head of the office."
A man who answered the phone for the Beijing number listed as the Nauru Embassy said this week that Mr Sanders was out of China and unavailable until next week. He laughed when asked about Mr Sanders' detention in Shanghai saying: "This is becoming more like a movie."
Former Nauru President Rene Harris has described the embassies as "phantoms" set up to smuggle out North Koreans.
Several Nauru Cabinet ministers said Mr Ray and Mr Sanders were intelligence agents, although both men denied it.
A source in China said while there had been questions raised about Mr Sanders' connections, the idea that he worked for the CIA seemed "a bit far-fetched".
"But then some other people who know him say whatever he is involved in would not surprise them."
Green MP Keith Locke has called for an inquiry into the allegations.
"To keep our name clean, the Government needs to thoroughly investigate this and tell the public what it finds out.
"The actions of our nationals in the affairs of other countries reflect directly on us, regardless of whether our Government sanctioned them or not."
The Prime Minister's office this week distanced the Government from involvement in "Operation Weasel" with a spokesman saying: "If the New Zealand Government wanted the Government of Nauru to assist it in any way, we wouldn't be using a Washington-based lawyer [Philip Gagner.]"
Mr Gagner confirmed he was not working for the New Zealand Government but declined to comment any further on who his clients were.
What is Operation Weasel?:
* The Weekend Australian newspaper reported that up to 20 North Koreans have defected to the West through an operation run at arm's length from the governments of 11 countries, including New Zealand.
* The newspaper said the North Koreans sought refuge in safe houses throughout the West, using some of the countries as transit points to escape.
* Part of the plot was to set up embassies for the Pacific island nation of Nauru in China and the US. The embassies would provide diplomatic cover for the defectors.
* The men reported to be a the centre of the plot included a New Zealander whose identity the Weekend Herald has revealed as Jack Sanders.
Who is Jack Sanders?:
* Red-haired Mr Sanders has lived in China for about 10 years, initially moving there to study martial arts.
* With the approval of Nauru's late President, Bernard Dowiyogo, he applied to be the island's diplomatic representative in Beijing.
* A Nauru Cabinet minister says Mr Sanders is working for the CIA and that he was detained by the Chinese authorities in Shanghai several weeks ago but was released because he was carrying a diplomatic passport.
Herald Feature: North Korea
By EUGENE BINGHAM