Did the Labour Party look the other way as its large donor Yikun Zhang bought up art and an imperial robe through other people to help fund its 2017 election campaign?
The man who ran the Labour Party machine as Jacinda Ardern swept into power in 2017 found himself grilled in microscopic detail about his memories of two dinners with one of the men now facing trial in a political donations fraud prosecution.
One of the dinners involved Ardern as guest of honour at a downtown Auckland Chinese restaurant two weeks before the general election. It resulted in that donor, who Labour had been schmoozing for months, paying $90,000 for an imperial Chinese robe, with the proceeds going to the party.
The controversial fundraising came after Labour had put a pre-election priority on rebuilding its links with Chinese and other communities, particularly in Auckland. Its charm offensive followed the party issuing a list of property purchasers with Asian-sounding names in 2015 that had damaged its standing with some of those groups.
At both dinners was Andrew Kirton, Labour's general secretary between 2016 and 2018. He is a Crown witness in a Serious Fraud Office case now being heard in the High Court at Auckland.
His evidence concerns six of seven people charged with obtaining by deception for schemes to conceal large party donations. The seventh defendant, former MP Jami-Lee Ross, faces a separate charge connected with two large donations to the National Party.
Evidence on the Labour art donations is being heard first.
Both Crown and defence lawyers questioned Kirton about a supposed 'silent auction' of five artworks in March 2017 that saw a donation of $60,000, netting Labour $35,000, from five Chinese purchasers. Three of them told the court this week they did not pay for the paintings or donate to Labour. The other two are defendants in the trial.
While their names were given to the Labour Party as the buyers of the art, defendant Yikun Zhang had provided the money and an associate of his, defendant Joe Zheng, had arranged to use the names.
Each of the 'purported purchasers' were provided funds to pay prices for the five artworks under the $15,000 Electoral Act threshold for their identities to be declared publicly.
In court on Thursday, Crown lawyer Paul Wicks QC asked about Kirton attending a dinner at Zhang's Remuera home with Labour's then-president Nigel Haworth and others. "What was the dinner for?"
Kirton said it was part of the party's outreach to the Chinese community in which Zhang was prominent. He also wanted relationships with political parties. Kirton could not recall if there had been any discussion on artworks.
Evidence showed that one of the other defendants had asked Kirton if he could take printed receipts for the paintings with him to the dinner, but the general secretary did not recall having them with him or delivering them.
Wicks: "At Yikun Zhang's home did you observe any particular items or photos of interest to you?" Kirton mentioned photos of Zhang with former Prime Minister John Key and now Auckland mayor Phil Goff.
To Zhang's defence lawyer Blair Keown, Kirton had to explain why within days of that April 2017 deposit of $60,000 into Labour's account, he dined with Zhang and had his photo taken with him in a hallway displaying four of the five 'Labour' paintings.
He is seen in the picture - which was displayed in court - standing with Zhang smiling before the brightly coloured works, which had been bought so the party could auction them, by another of the defendants, whose name is suppressed.
Kirton repeatedly said he did not know the paintings behind him were the artworks Labour had profited from. He thought the photo was taken in that hallway because it had sufficient space for what was, in his experience, a common practice at Chinese events to snap photos.
Keown: "I suggest to you, Mr Kirton, that you knew this at the time."
Kirton: "Absolutely not."
Keown: "The paintings in the hall were four of the five that came from the Labour Party."
Kirton: "Yes, I've learned that subsequently."
The defence line of questioning included displaying a floor plan and detailed questions about where in Zhang's home Kirton had moved, to show he would have walked past the paintings more than once. The questions focused on whether Kirton and others must have known Zhang was the buyer and donor who paid that $60,000.
Instead, the party was provided a list of other names as buyers of the paintings and recorded them as donors.
Keown also focused on whether Kirton had taken to the dinner the receipts made out in the names of what the Crown calls 'sham donors', noting he had three days later emailed another Labour official asking her to complete them. Keown said the purported buyers had never received the receipts because Kirton never sent them, knowing they had not bought the items.
In the same vein as the questioning about the Remuera dinner and the paintings, Keown suggested Kirton and the Labour group with Ardern at the September 9, 2017 restaurant fundraiser must have known Zhang bought the imperial robe that dominated the fundraising auction.
Kirton had seen the glass encased robe among auction items but the VIP party had been ushered to an area at the rear of the restaurant, with their view of the public area disrupted by a partition.
He and Ardern sat with Zhang.
But Kirton told the court he did not know if he was still at the event when the auction occurred. When reminded of his statement to the Serious Fraud Office that he recalled the bidding being in Chinese and English, he acknowledged he must have been there.
Keown: "You were there."
Kirton: "That must be the case. I apologise."
The robe sold for $90,000, the highest item on the night, and that must have been a big achievement for the party, Keown said, before asking Kirton if he had thanked the successful bidder.
"It would be a basic courtesy ... You wouldn't take $90,000 and not thank them, would you?"
Kirton: "There's other ways of thanking them rather than rushing up to the owner and shaking their hand. We might send them a note later. If the question was did I thank the owner, then, no, I do not recall that."
Keown: "At a Chinese event, where Labour is seeking to reconnect, you would appreciate the concept of 'face' would be particularly important in terms of being thanked."
Kirton: "I suppose so. My role that evening was to Jacinda Ardern. The focus was on making sure she was comfortable. I knew I was not personally the organiser of the fundraiser."
Keown said it had been Kirton, however, who had urged an Auckland Labour figure to seek fundraising opportunities from high-end Chinese backers in the campaign period.
Earlier in the week, in opening remarks to the court another lawyer for Zhang, John Katz QC, had said his client had paid the money for the paintings and accepted the Labour Party had erred in its donations declaration for that 2017 period.
The Crown's opening noted that Zhang had wanted a royal honour and was made MNZM in the Queen's Birthday honours in 2018, the year after his donations to Labour and one donation to National. It claimed the prospect of an honour was a possible motive for the scheme to conceal his identity as a donor.
As well as Zhang and Ross, the defendants in the case are Joe Zheng and his twin brother Colin and three people who have name suppression in connection to the Labour part of the case.
All have pleaded not guilty to the charges of obtaining by deception. The trial, which will hear from 51 Crown witnesses, is set down for another nine weeks.
