Yikun Zhang, and brothers Colin (Shija) and Joe (Hengjia) Zheng, were sentenced to community detention and community work by Justice Gault in the Auckland High Court . Photo: RNZ
Three businessmen who made unlawful donations to the National Party have been sentenced to community detention with their past philanthropy taken into account.
The trio, Yikun Zhang, and brothers Colin and Joe Zheng, appeared at the High Court in Auckland before Justice Ian Gault today.
Justice Gault said the men had lost significant standing in the Chinese community as a result of their crimes.
"Professor Clark at the University of Auckland explains mianzi, which is best understood as a Chinese equivalent to the Māori concept of mana. Losing mianzi produces a great sense of shame especially for someone as influential as you."
A lengthy trial was held after the Serious Fraud Office brought charges against seven people, claiming they helped to split large donations to the Labour and National parties into smaller amounts to hide the true donor.
Zhang, whom the Crown alleged was the orchestrator, was found guilty of obtaining by deception in relation to a donation to a National Party in 2018.
Colin Zheng, whom the crown alleges was Zhang's right hand man, was found guilty of obtaining by deception in relation to two donations made to the National Party in 2017 and 2018.
Joe Zheng was found guilty of one charge of obtaining by deception in relation to one of the National Party donation's and guilty of obstructing a Serious Fraud Office investigation.
During the trial all defendants denied the charges.
The Crown told the court today it was seeking imprisonment for all three men because the offending involved subversion and manipulation of a public process.
Paul Wicks KC said a transparent process allowed public to scrutinise and put questions to parties regarding relationships and donations.
"Electoral fraud offending undermines principles of a democratic society."
Justice Gault said the public's trust in the system was the victim.
"It was not highly sophisticated, but did require premeditation and a degree of planning."
Yikun Zhang's lawyer John Katz KC called for a discharge without conviction, arguing undue hardship.
"He has the utmost respect for court process, has been held accountable to the highest standard, and accepts the consequences, gravity and seriousness of his offending."
Katz said Zhang had expressed remorse for his actions.
He said it would be a fall from grace that was the real penalty given Zhang had been a leader in the Chinese community.
"There will be no coming back from this and he will deal with this for rest of life."
Tame Iti, John Tamihere and former Auckland mayor Phil Goff wrote letters of support for Zhang, referring to his generosity.
During the high profile trial, the Crown alleged three separate donations were split into smaller amounts among "sham donors" to avoid triggering the disclosure limit and to keep party officials, the Electoral Commission and the public in the dark about the identity of the true donor - businessman Yikun Zhang.
Jami-Lee Ross and three businessmen - Yikun Zhang, Shijia (Colin) Zheng and Hengjia (Joe) Zheng - were charged by the Serious Fraud Office over donations made to the National Party in 2017 and 2018.
Justice Gault found Zhang not guilty in relation to the National Party donation in 2017 but guilty of the donation in 2018.
Colin Zheng was found guilty in relation to the 2017 and 2018 donation.
Joe Zheng was found guilty in relation to the 2018 donation and guilty of obstructing a Serious Fraud Office investigation.
The three businessmen also faced charges - alongside two men and a woman, who all have interim name suppression - over donations made to the Labour Party in 2017. Justice Gault found they were all not guilty in relation to that donation.
Ross was acquitted on all charges.
The Zheng brothers
Businessman Colin Zheng, described during the trial as Yikun Zhang's right-hand man, played more of an active role in the deception than his brother Joe Zheng.
Crown lawyer Paul Wicks KC described Colin Zheng as the architect of the deception.
Colin Zheng's lawyer Paul Dacre KC told the court his client had enjoyed success in New Zealand and his fall from grace was significant.
"Putting aside this offending, he is the sort of immigrant which we, as a country, welcome. He has participated in community services and been a model citizen."
Zheng will no longer be a director of his business nor act as a Justice of the Peace and Dacre said that his political aspirations had been squashed.
Wicks said Joe Zheng acted on instructions from his brother but was aware of the disclosure threshold for political donations.
His lawyer Rosemary Thomson said the family dynamic and cultural traditions led to his offending.
"Joe has to respect and listen to his older brothers, assist them on everything, and he never lost trust in them."
Thomson described Joe Zheng as a follower not a leader.
"He was not part of the discussions, he followed the instructions from his brother."