Exchange Rates, Secret Accounts and Pecuniary Interests

The comment below on KiwiBlog got me thinking.  Isn’t this precisely the sort of conflict that the pecuniary interest register was designed to deal with?

This money has been sitting offshore presumably while he waits for a more favourable exchange rate to move it back, something he has been strongly advocating for in parliament and elsewhere.

Does knowing that Shearer has possibly hundreds of thousands of dollars resting in an offshore account cast his crazy exchange rate ideas in a slightly different light?

Colin Espiner meanwhile absolutely nails Shearer’s dirty little secret account problem.

I don’t know about you, but I’m forever forgetting about my offshore bank accounts with large amounts of cash in them. It’s a job to remember to tell the IRD about it, let alone to declare them where I might have a conflict of interest.

But then, I’m not an MP. More particularly, I’m not the leader of the opposition, nor the head of a party that has made something of a habit of calling for the heads of other MPs whose memory has been somewhat imperfect.

David Shearer claims he “forgot” about his account with Chase Manhattan Bank in New York City when he came to declare his financial interests to Parliament, as is required under the MPs’ Register of Pecuniary Interests. 

Well, we all make mistakes, and none of us are getting any younger except policemen. But Shearer didn’t just forget the one time. He forgot four times in a row – 2009, 2010, 2011, and 2012.

To compound matters, though he forgot to disclose the account to Parliament and therefore to the public, he did remember to tell the IRD about it. He also remembered to tell Parliament about his other bank account with Westpac.

Given that only accounts with more than $50,000 in them must be publicly disclosed, it’s highly surprising that this slipped Shearer’s mind. Either the Labour leader is extremely forgetful, or he has a lot more money stashed away than any of us thought.

We don’t know the actual amount, since Shearer hasn’t disclosed that, because he doesn’t have to, but it could be considerably more than $50,000.

Does it really matter that Shearer didn’t tell Parliament about his offshore bank account? Well, yes, actually, it does.

It does matter. Shearer and his party went on and on and on about “brain fades” making people unfit for office.

* It makes the Labour leader look like a hypocrite. Much fun was had by all taunting Prime Minister John Key about his faulty memory over the Kim Dotcom fiasco last year. Indeed, Shearer himself laughed that Key had “the year of the brain fade” and that “the PM’s memory went Dotgone”. He also accused Key of “not telling the truth”. And Labour mercilessly pilloried ACT leader John Banks over his memory about receiving donations from Dotcom, claiming he had “lied to New Zealanders”.

* It undermines the picture Labour has painstakingly assembled of National as the party of easy money and loose financial morals. In 2010, Labour’s attack dog Trevor Mallard was calling for Attorney-General Chris Finlayson to step down over a non-disclosure in his own pecuniary interests. And who can forget the mud slung at Key by Labour over his ownership of shares in TranzRail, which he did not declare before rising in Parliament to ask questions of the company while leader of the opposition?

* It knocks Shearer off his pedestal as Parliament’s “anti-politician”, a position he and Labour’s PR flaks have been keen to occupy since his election in 2009. Shearer, and Labour, have played up his credentials as the former aid boss and humanitarian worker who has no time for politicians’ lies and silly games. And yet he appears to have been doing precisely the same thing as everyone else.

Espiner doesn’t think Shearer lied to parliament. I think he did. He lied by omission and he omitted the details because quite simply they are embarrassing for the leader of the workers party to be sitting on a rather large sum of money while making up stories about painters on roofs, secret GCSB video tapes and now his fanciful story of doing his tax returns with the missus.

The tax return story was the one that got me. I was worried about this so called my accountant and they wondered why I was worrying about it before the tax year even finished…they said I had a further year after that too…so just what was Shearer doing with his missus because it was unlikely to have been his tax returns, since they aren’t due and the tax year isn’t complete.

The quantum of the amount that Shearer “forgot” is now becoming critical. It would be interesting to know what his forgetful threshold is. We now know it is more than $100k…but imagine if it was $500k, or even a million…who “forgets” those amounts?

David Farrar runs some calculations:

According to the UN, the salary of a senior manager in a Middle East post would be around US$190,000 a year. Now consider that this is tax free, and that when you are on assignment basically all your living and travel costs are work expenses. So the vast majority of your salary can be saved.

Shearer worked for the UN from 1989 to 2000 and 2002 to 2009, which is a total of 18 years. The total UN salary over that period could have been a bit over US$3 million tax free and expense free. To have an account balance of only US$60,000 means you saved only 2% of it. If you saved 20%, then the account might have over US$500,000 in it.

Now that is a lot of hooter for the leader of the workers party to be forgetful of.


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As much at home writing editorials as being the subject of them, Cam has won awards, including the Canon Media Award for his work on the Len Brown/Bevan Chuang story. When he’s not creating the news, he tends to be in it, with protagonists using the courts, media and social media to deliver financial as well as death threats.

They say that news is something that someone, somewhere, wants kept quiet. Cam Slater doesn’t do quiet and, as a result, he is a polarising, controversial but highly effective journalist who takes no prisoners.

He is fearless in his pursuit of a story.

Love him or loathe him, you can’t ignore him.

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