Harawira - Securities Legislation Reform Bill
Harawira - Securities Legislation Reform Bill
Hone Harawira Member of Parliament for Te Tai Tokerau
Tuesday 21 February 2006; delivered 9.30pm
I was reading an article the other day entitled, 'Dishonest Nation' - very interesting reading it was too. In that article, renowned criminologist Dr Greg Newbold, said white-collar crime was about forty times that of benefit fraud. Forty times greater.
So why does benefit fraud make all the headlines, while white-collar crime hardly rates a mention? Mr Speaker, why aren't all fraudsters treated the same?
When I look at my cousins who have been prosecuted by WINZ and made liable for their debts; I have to ask what is so different about white-collar crime that lets certain people off the hook?
Well, I guess that one of the reasons is because white-collar crime is carried out by the so-called more respectable members of society - you know the ones - the really big fraudsters. White-collar crime is also described as 'victimless', because there aren't any gang patches, black eyes, tattoos, and foul language, but believe me, the victims may be a little less obvious, but they're there alright, in their thousands. For example, false insurance claims mean that everyone's premiums go up. It's just that the face of the victim isn't staring out from our newspaper pages.
It seems that government has no problem running big-budget media campaigns to dob in the benefit-fraud neighbour. So why don't they run similar campaigns to dob in the white-collar fraudsters?
The Maori Party supports any move to enhance New Zealand's securities and takeover laws, because at the moment, we are seen as a bit of a cowboy in this area, and even the cowboys are complaining about our behaviour.
Being clean and green is just not enough. In this field, integrity is what counts. This House talks a lot about integrity, most of it tongue in cheek of course, but that is indeed the issue we put to our business colleagues - integrity and full disclosure by investment traders and advisers to their clients.
As a matter or principle, the Maori Party supports any moves which act to ensure responsibility towards clients, and which protect the interests of clients in the event of wrongdoing. The Maori Party supports transparency, accountability, and being up-front.
The Maori Party is driven by the call of our people for justice - knowing and respecting the rules - not trying to find ways to bypass them. And the Maori Party would urge this House to recognise that the best way to get businessmen to respect the concept of integrity, is to put it into practice ourselves, and honour Te Tiriti o Waitangi.
It is also interesting that this Bill increases the penalties and remedies in order to deter breaches and to encourage compliance. The Breach of Securities Act introduced a maximum penalty of up to $500,000 for individuals and $5m for a body corporate. For insider trading, the penalty is five years in prison and a $300,000 fine for an individual and a $1m fine for a body corporate. And yet, I am told that there have been no prosecutions in New Zealand to date for insider trading - and we are told that existing laws are complicated, difficult to enforce, and easy to avoid.
The changes are therefore necessary to ensure market integrity and confidence. Hopefully the changes will give confidence to people who may be considering investing, but have not done so because they know that the sharks are still swimming freely, having escaped the net of the law until now.
A lot of the white-collar criminals have the luxury of being able to afford a heap of expert legal hotshots and accounting wizards, and it is little wonder that Inland Revenue has a hard time catching up with the big boys. But Inland Revenue don't have the same difficulty with the little businessman, and they have no problem beating up on the poor little beneficiary.
Mr Speaker, just to end the night, I want to share a true-life story that came into our office.
A 73-year-old grandmother rang us up in a state of major distress. She had been reported for benefit fraud, because WINZ reckoned her male friend was staying over for a couple of nights a week. 73 years old!!! Are we serious ??
This kuia was in despair, and seriously pissed off that her and her male friend were being treated like criminals by the WINZ police. 73 years old ...
We managed to get the case withdrawn of course, because the allegations were baseless innuendo. But the traumatic effect of this experience had left its toll on our kuia.
It made me wonder why we dedicate so much money to hassling the poor and elderly, when the multi-million dollar corporate thieves simply skip the country, hire a flash lawyer, declare bankruptcy and don't give a toss about the poor little investor.
During our time in this House, we will look to see how effective this law is. If it turns out to be as toothless as the current law, the Maori Party will promote legislation to genuinely plug up the holes, and nail these white-collar criminals.