Tax officers used me to bug, says businessman

Press, 16 June 1983, Page 1

Tax officers used me to bug, says businessman

PA Auckland An Auckland businessman alleges he bugged conversations with a city accountant at the behest of two Inland Revenue Department officers.

The businessman, Ronald James Kingsnorth, yesterday said that the officers had strapped a listening device to his arm and later monitored his discussions with the accountant. The officers were trying to gain evidence against one of their colleagues for alleged improper conduct, he said. The revelations by Mr Kingsnorth as outlined by his lawyer, Mr E. P. Leary, in a letter to the Prime Minister, Mr Muldoon, prompted x an investigation by Auckland detectives.

Mr Kingsnorth said the bugging device, which was tuned to an FM frequency, was his own property. He said he had had previous dealings with the accountant and the tax inspector being investigated by the two officers.

Mr Kingsnorth alleged that the two officers had said: “We will do that” when he suggested the only way to get information they wanted from the accountant was by “bugging” him. “They told me it was legal, provided it was done with their permission. They assured me I was not breaking the law because I was acting on their instructions,” said Mr Kingsnorth. “He (one of the officers) also intimated to me that he was a member of the Security Intelligence Service. He asked me if I would bug him (the accountant),” he said.

Mr Kingsnorth said he had agreed to “bug” the

accountant in exchange for an alleged assurance that he would not be liable for back tax up to and including 1983, provided he put in reasonable returns. He described how on two occasions (March 10 and 30, according to Mr Leary) he had long talks with the accountant while the two Inland Revenue officers were in a “Post Office van” outside the accountant’s office.

Mr Kingsnorth said the first session lasted about 4Vz hours and the second 2Vz hours. He said he had instructions on what to ask the accountant about the affairs of the tax inspector under investigation.

Mr Kingsnorth said he had later heard parts of the tapes the two officers obtained from the “bugged” conversations.

“They kept laughing and saying, ‘We’ve got him. It proves he is corrupt’,” he said.

Mr Kingsnorth said he was later introduced to another tax investigator. After a second interview with the official, Mr Kingsnorth said he began to suspect the deal he believed he had made over his back tax would fall through. He feared the apparent power of one of the two officers with whom he made the back tax deal. “He told me in the White Heron (Lodge) that he was in the 5.1.5., that he was a member of the Embassy Club, and that he was a free-mover throughout Government departments,” he said.

“They seemed to have a lot of power ... to go round in Post Office vans and come round in different vehicles,” he said.

Mr Kingsnorth said one of the two officers had alleged that among his tasks was to follow up calls from a topclass city hotel when guests deposited large amounts of money there. On one occasion, he said, the officer arrived at one of his premises wearing a traffic officer’s uniform.

Mr Kingsnorth said that, on learning of what had allegedly happened, Mr Leary suggested he should go to the police. It was on Mr Leary’s recommendation that Mr Muldoon was informed of allegations against two Inland Revenue officers said to have been involved in the bugging incidents. Mr Kingsnorth, who has had two three-hour sessions this week with police investigators, said that the two Inland Revenue officers had produced a listening device “from a source they could not mention.” The bug had not worked as well as his own, and so it was not used in the talks he had with the accountant. Mr Kingsnorth said he had been shown a police listening device. “The one I saw (with the two officers) did not come from the police,” he said. Mr Leary said that his client was most concerned that he had been misused by the Inland Revenue officers. “In our New Zealand con-

text, it is worse than Watergate,” he said. “A matter of this magnitude is in grave danger of being kicked under the carpet because of its political implications.” The officer in charge of the police investigation, Detective Inspector Barry Matthews, said that in-, quiries had shown that the Post Office was not involved in the alleged activities or the supplying of the Post Office vehicles said to have been involved. “It is a vehicle with Post Office markings, but it was not supplied by the Post Office. It was obtained from the Public Service Garage,” said Mr Matthews. He confirmed that a complaint was made by the Commissioner of Inland Revenue, Mr John Simcock, to the Commissioner of Police, Mr R. J. Walton. The complaint, said Mr Matthews, concerned allegations of illegal uses of listening devices in contravention of the Crimes Act. Police inquiries, which began two weeks ago, should be completed next week, he said. His report on the investigation would be referred to Mr Walton. The Minister of Inland Revenue, Mr Falloon, confirmed that he had initiated police and departmental inquiries into bugging allegations against Auckland tax officers.

He said that alleged impropriety by departmental staff in Auckland was being investigated by the police and Mr Simcock.