Touch NZ Targeted by Alleged Fraud

Media Release

19 December 2006

Touch NZ Targeted by Alleged Fraud

Touch New Zealand is gutted that three people associated with the organisation – one its ex-Chief Executive, another a former Kiwi rugby league captain – have been charged with fraud involving community grant applications between 2000 and 2004.

Former CEO Dick Arnott and an employee of the organisation, Geoff Thompson, both appeared voluntarily in Christchurch District Court this morning to be charged with alleged fraud. A contractor to the organisation – former Kiwi rugby league captain Hugh McGahan – appeared in court in Auckland yesterday, also relating to the alleged fraud. All three chose not to request name suppression, and have been remanded to appear in Auckland District Court on January 19.

Others outside of the organisation have also been implicated, but are yet to appear in court.

The organisation’s new Chief Executive, Dale Stephens, said Touch NZ hadn’t been implicated in the charges, and had co-operated fully with the Serious Fraud Office’s investigation.

He said the money allegedly involved could have been used by Touch NZ to grow the sport throughout New Zealand at community, national and international levels. “It could have really helped with our preparation for major events such as the Touch World Cup in South Africa next month, and for our bid next month to host the Touch World Cup in New Zealand in 2011.”

Touch is New Zealand’s largest team sport, with 317,000 people participating last year. The organisation relies heavily on grants from charitable trusts – which total 68% of its income – and sponsorships.

In the time since the alleged fraud took place, the Board had been replenished with a new Chair, Peter Goldsmith, and three new board members – with a much stronger emphasis on financial management and audit to ensure more transparent governance by the organisation.

Measures were now in place to ensure alleged fraudulent acts such as this didn’t occur in the future, Mr Stephens said.

Among these was the appointment of Mr Stephens, who joined the organisation as Chief Executive last month (November 2006). He was a police officer for 22 years and was promoted to Inspector before moving into the commercial sector. He is a director of three companies and was ironically a member of the Wellington fraud squad for six years during his career in the Police.

“As you can imagine the Board and I really disappointed that people who the organisation had trusted are implicated in an alleged fraud, but we’re determined to continue the development of the sport for all New Zealanders,” Mr Stephens said.

Dick Arnott resigned from Touch NZ in April this year, having worked for the organisation since 2000. Hugh McGahan’s contract hasn’t been renewed following the fraud allegations, and the organisation is taking legal advice regarding Geoff Thompson’s employment.

ENDS

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