Saturday, January 30, 2010

Sunset day b4 yedterday

Serene warmth
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Thursday, January 28, 2010

On the beach...

After bushcrashing from the top I am on the beach now, and it is a swim next...
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Tuesday, January 26, 2010

The people of New Zealand Paid for AVATAR (Twentieth Century Fox) James Cameron blockbuster

Seeing Avatar in 4-D
By TOM PULLAR-STRECKER - The Dominion Post
Last updated 05:00 25/01/2010

OPINION: Few taxpayers who have seen Avatar would have guessed they
had already paid the ticket price in the form of the $44.7 million
government grant awarded to the film's producers.

It certainly adds another dimension to the viewing experience.

Indirectly, the very private Weta Digital is probably the biggest
single beneficiary of the largesse from the public purse.

Its reputation may be its biggest drawcard in winning work from
Hollywood, but it may be that the grant was required to get Avatar
over the line for the company.
It would be hard to quantify the benefits of bringing big productions
such as Avatar and The Lord of the Rings to New Zealand.

A fair slice of the spending on Avatar would have gone on kitting out
Weta Digital's brand spanking new Miramar datacentre with imported
computer hardware.

Weta had 700 people working for it in March last year when work on
Avatar was at its peak, but many of its graphic artists are
contractors who flit from country to country.

It's anyone's guess what proportion of their pay cheques would be
recycled into the economy.

Film New Zealand acting chief executive Sue Thompson notes that film
productions have had a huge spinoff for tourism, although that is
probably more true of The Lord of the Rings trilogy than it will be
for Avatar. Godzone became Middle Earth, but marketing it as Pandora
might be stretching it.
The more amorphous reputational benefits shouldn't be dismissed,

Weta may enjoy being behind the spotlight more than in front of it,
but New Zealand's involvement in the production has not gone unnoticed

It is the country's highest-profile industrial achievement.

It is possible that the movie industry may become a game for high
rollers, too rich for Kiwi taxpayers to stay at the table.

The hope has to be that the film industry's undeniable momentum and
the country's natural advantages - its skills base and the lifestyle
it can offer young, creative people - will mean that New Zealand can
get away with offering lower subsidies than competitors, or at least
not further fuelling the arms race over production grants.

The media in South Korea is expressing some cynicism over the ability
of its government to buy its way into the industry.

Encouragingly, Weta Digital spokeswoman Judy Allen reports a strong
pipeline for the year ahead, with work on The Adventures of Tintin,
The Secret of the Unicorn, The Hobbit and other projects.

There is some irony in Sir Peter Jackson's acquisition of the film
rights to Philip Reeve's Mortal Engines novels.
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In the books, which are both nostalgic and futuristic, cities have
become mechanised but impoverished, travelling an increasingly
scavenged Earth in search of other cities they can conquer and scrap.

Civic competition in the film and special effects industries hasn't
quite come to that, but it's closer to the bone than the cliched
depiction of economic motivators in big business on Pandora.


AVATAR takes us to a spectacular new world beyond our imagination, where a reluctant hero embarks on a journey of redemption and discovery

AVATAR takes us to a spectacular new world beyond our imagination, where a reluctant hero embarks on a journey of redemption and discovery

James Cameron's epic motion picture, Avatar - in theatres December 18th worldwide. Starring Sam Worthington, Sigourney Weaver, Michelle Rodriguez

"Avatar" director James Cameron talks about not one, but two sequels he has in mind for his latest blockbuster.

Director James Cameron made Titanic, the highest-grossing film in history

1. Avatar
2. Production year: 2009
3. Country: USA
4. Cert (UK): 12A
5. Runtime: 161 mins
6. Directors: James Cameron
7. Cast: CCH Pounder, Giovanni Ribisi, Michelle Rodriguez, Sam Worthington, Sigourney Weaver, Stephen Lang, Zoe Saldana

Any lingering suspicions that James Cameron has become the Al Gore of Hollywood will be firmly extinguished by his new, monstrously-hyped creation. For a while, it looked like he was giving us a reasonably sweet-natured blockbuster, suggesting that the natural world has, like, the power to heal us all, or something. Then Cameron sends in the helicopter gunships and starts blowing shit up, big time. Way to undermine your own message.

Avatar, for anyone who's had their head in the sand for the last few months, is the first film in over a decade from the man behind Titanic, still the all-time box-office champ. The success of that film presumably allowed Cameron to write his own cheques for this one, and it's a project that's been stewing on the back burner for at least as long, waiting for the special-effects industry to catch up.

And whatever the truth behind the rumoured hundreds of millions spent on it, Cameron certainly gives Hollywood a lot of bang for its buck. Avatar, in all conscience, looks fantastic â.. a near-seamless melding of fantasy extraterrestrial landscapes and cutting edge computer-generated imagery, all inserted beautifully into the high-testosterone camerawork which Cameron has made his specialty.But what is this highest-of-high-end image-making aimed at? Cameron has constructed a fable that combines militarist sci-fi, alarmingly vacuous eco-waffle and an intra-species love story that is presumably designed to cover all the bases. The central character is one Jake Sully (Sam Worthington), a paraplegic marine who is assigned to a mining colony on the alien world of Pandora, where he joins a band of nerdy scientists trying to establish friendly relations with the locals; this they hope to achieve by fusing their brains with specially developed beings (the "avatars" of the title) that are a blend of human and alien DNA.The locals turn out to be spindly blue 10-foot humanoids with distractingly twitchy ears â.. suggestions that Avatar is somehow channelling Ferngully are not all that wide of the mark. Sully quickly falls for the non-specific mystical rabbitings of the tribe, involving memory-harbouring trees, intimate relationships with flying lizards, and other such prog-rock-influenced stylings. It really is like a Yes album cover come to life.Sully's position is made considerably more tricky by the genocidal glee of his human military commander, who â.. in a plot move shamelessly similar to Cameron's earlier film, Aliens â.. is prepared to cause mass casualties in the service of the sleazy mining-corporation executive.There are heavy-handed attempts to implant contemporary references (at one point, the marines are told to fight "terror with terror"), but there's no mistaking what Avatar is taking aim at: the founding myth of America, and the incursions of European colonists into indigenous civilisations. The Na'vi, the tribe with whom Sully fetches up, are a sort of grab-bag of generic tribal characteristics â.. a little bit African, a little bit Amerindian, the equivalent of one of those worldbeat restaurants that serve up teriyaki tortilla and the like.To his credit, Cameron is a skilful narrative organiser, and fairly soon he has you rooting for the aliens, not those pesky human invaders. (This may not be the most tasteful approach though, to use on an American audience that still doesn't appear to feel especially guilty about what happened to the indigenous people on their own continent.)Be that as it may, Avatar tries to have it both ways, to be preachy and a thrill-ride at the same time. I can't in all honesty say it pulls it off â.. it's baggy, longwinded and, for all the light-speed imagery, just not quick on its feet. Cameron used to be the tautest film-maker around, but he just got slack.

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Sunday, January 24, 2010

Hi from the high seas, swiss tourist natasha had captain Brad congratulate about "the best legs ever to grace this vessel".
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Thursday, January 21, 2010

$1.3 billion a year - Rental Property 200 billion

We have $200 billion tied up in residential rental property, four times the capitalisation of the NZX, yet it results in negative tax.

read this again:

We have $200 billion tied up in residential rental property, four times the capitalisation of the NZX, yet it results in negative tax.



Tax plan slammed as 'an orchestrated attack on landlords'
By Anne Gibson
4:00 AM Thursday Jan 21, 2010

Tax recommendations presented to the Government have been criticised as "an orchestrated attack on residential landlords" by the Property Investors' Federation vice-president.

Andrew King said the tax working group's recommendations would devastate his sector and could affect the lives of about 1.4 million tenants.

He predicted landlords would rush to leave the industry in large numbers if the Government acted on the report.

The tax group singled out landlords as one big target, saying they were being "systemically under-taxed" and recommending a more direct approach. Axing tax depreciation on buildings, a big bonus for many landlords, is on the cards.

Peter Dunne, the Revenue Minister, backed the tax group's aim of pulling landlords into line.

"There is growing evidence that trusts and companies and highly geared residential rental properties are being used to reduce taxable income and so qualify for Working for Families. Such abuse potentially places an unfair burden on the 60 per cent of families who do not receive Working for Families tax credits," Mr Dunne said.

John Shewan - a tax group member, PricewaterhouseCoopers chairman and landlord - is aghast that some multimillionaire landlords qualify as state beneficiaries because they appear poor on paper. He debunked Mr King's views.

Article continues below

"Landlords are in a business inherently of an investment nature rather than of an operational nature like farming. We have $200 billion tied up in residential rental property, four times the capitalisation of the NZX, yet it results in negative tax. We felt that was very hard to justify in policy terms and we feel some change is required," Mr Shewan said.

About 460,000 privately owned rental properties worth at least $165 billion are home to at least 1.4 million tenants. The state has a big hand in the sector: Housing NZ runs 69,000 houses worth $14.5 billion. The state owns most of those but manages some which are leased long-term from private landlords.

Mr King predicted the recommendations would create social chaos by creating a rental property shortage. All house prices would drop because landlords who bought under one set of rules would quit and flood the market with properties. Tenants would be out on the street if the changes were enacted, he predicted.

The tax working group had a strong bias against landlords and was not interested in the federation's views, Mr King claimed, a point Mr Shewan rebuffed, saying the group had listened to the federation but did not agree with it.

Mr King was outraged that he and president Martin Evans had to pay $200 to attend the group's final session in Wellington last month.

Rental property had no tax advantage over other investments or businesses, Mr King claimed. Rules about expenses for deducting costs such as mortgage-interest payments, upkeep and maintenance were the same for housing as for investments in shares or farming, he said.

"Many businesses make a loss during the first few years while getting established and rental property is no different. The rental market is extremely competitive and tenants enjoy lower rents because of this, helping them to save for a deposit on their own home."

Mr King said many landlords had bought on the basis that they could claim depreciation as an expense. That benefit allowed them to keep down the cost of renting.



PricewaterhouseCoopers chairman John Shewan, a member of the working group, pointed out that the more than $200 billion invested in rental properties yielded less than nothing in tax - between $100 million and $200 million less - because of the ability to use losses to shelter other income.

and again:

PricewaterhouseCoopers chairman John Shewan, a member of the working group, pointed out that the more than $200 billion invested in rental properties yielded less than nothing in tax - between $100 million and $200 million less - because of the ability to use losses to shelter other income.

P R O P E R T Y !! Own rental buildings, let them rot and

Tax group targets building depreciation
By Brian Fallow View as one page
4:00 AM Thursday Jan 21, 2010

Tougher rules for depreciation and thinly capitalised companies are among the more targeted base-broadening measures proposed by the tax working group.

These are measures the Government could adopt quickly, it says.

It regards it as illogical that taxpayers can claim depreciation on assets that are in fact rising in value.

It suggests denying depreciation on buildings if, as it suspects, evidence suggests buildings do not depreciate.

Officials estimate it could raise up to $1.3 billion a year in revenue, though that could be reduced by up to $600 million if an offset was allowed if buildings were subsequently sold at a loss.

The working group also suggests reducing or eliminating the 20 per cent loading that applies to the depreciation rates for new assets other than buildings. This is estimated to be worth about $300 million a year.

It also suggests reducing the 'safe-harbour' threshold for thin capitalisation from 75 to 60 per cent.

The thin cap rules are meant to curb the scope for foreign-owned companies to reduce the tax they pay in New Zealand by funding their local operations mainly by debt, which gives rise to deductible interest payments.

Article continues below

But Deloittes tax partner Thomas Pippos opposes such a change.

He argues it would put New Zealand out of step with other countries and does not address the issue, which is that the thin cap regime is not being applied as it was originally intended.

Institute of Chartered Accountants tax director Craig Macalister questioned the case in principle for tax changes targeted at property investments when the rules are in fact consistent with those applying to other investment classes.

PricewaterhouseCoopers chairman John Shewan, a member of the working group, pointed out that the more than $200 billion invested in rental properties yielded less than nothing in tax - between $100 million and $200 million less - because of the ability to use losses to shelter other income.

"It is very hard to justify that outcome. It is not a sustainable ongoing position," Shewan said.

Pippos agrees and said the short-term answer to the issue was to remove depreciation deductions for residential properties.

Ring-fencing or quarantining losses might also need to be considered in the medium term if the Government continued to sustain losses from the sector, he said.

In this context there was also a case for tighter rules on the ability to claim deductions relating to "mixed-use" assets such as holiday homes which were used partly to generate an income as well as providing an amenity for the owner's use. These could give rise to material tax losses, Pippos said.

Deloittes opposes a land tax, a view strongly held by tax partner Mike Shaw, a member of the working group.

He argued it was distortionary in imposing a tax on one asset class, land, that others escaped. It did not address the issue of losses being generated in the residential rental sector.

"It raises a plethora of other issues, including cash flow and valuation concerns and whether certain sectors should be exempt," Shaw said.

Some members of the tax group favoured applying the risk-free return method to residential rental properties. This was advocated much more broadly by the 2001 McLeod tax review.

Investment properties would be taxed on a deemed return equivalent to the risk-free rate (set by a Government bond) adjusted for inflation, implying tax of between 1 and 2 per cent on the value of the property.

But it presents several design issues, and is especially problematic for investment properties that are already cashflow negative.
By Brian Fallow | Email Brian

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Sunday, January 17, 2010

What to do with your remaining amount Prezzy Card credit

What to do with your remaining amount Prezzy Card credit

CLICK On the following link:

>> Donate to Oxfam's work around the world <<

on this page:

DEDUCT One New Zealand dollar .. because the paypal transaction behind the scenes will swallow $1 or even a bit more.

You can fill out the form with bogus info

Name: Prezzy Card Holder
Address: RD1
City: Auckland
Postcode 1000

This was by link:


Single Donation
PO Box 68 357
64 9 355 6500

17 January 2010

Admiral tttt

Dear Admiral tttt:

Thank you for your generous donation of $0.77.

We greatly appreciate your support. It is only through efforts such as yours that we are able to continue our vital work to find lasting solutions to poverty and injustice.

Your donation is tax deductible, and a tax receipt will follow through the post.

Should you have any questions about this, or any matter, please do not hesitate to contact us via the details below.

Thank you once again for your kind gift.

Yours sincerely,

Barry Coates
Executive Director

Oxfam New Zealand
PO Box 68357
Auckland 1145
New Zealand
Tel: +64093556500
Fax: +64093556505

(A copy of this confirmation was sent to the following email address: on 17/1/2010 at 5:36:16 a.m.)

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Hitching in kiwistan's far north

Start a 7:11 in mangonui, 15min wait, just started munching a sandwich, wooops, a lift by a tattoed maori ca30yr male in a beat up, comfy jap waggon, to Taupo Bay.
Not 10min later a great guy with a luxury classic car, electric adjustable seats, a nice aroma cup of coffee on the middle console -- hyperspaced me into Kaeo.
8:44 a working man, maybe a builder, took me to the Kapiro Rd turnoff to Kerikeri, we talked about religion and beer. I told him about Richard Dawkins and he complained about his wife. "anglican" .. "i don't mind service, you know, 20 minutes is fine, but theirs is four bloody hours,and then agian, in the evening, you know."
8:59 a business lady drives a detour to bring me to "great spot for hitchhiking", Kerikeri Rd. She warned me about Maoris, I warned her about Bankers.
Yey, another lift! I am now (10:07) sitting in a large aircon black SUV travelling with Wayne and the talk is about rewu alley kiwi china sympathy, russia and art. But mostly profit angloamerican bullshit. 10:16 and we are in Whangarei.
Mandarins in (book2read: "1421") destryed all records of voyages dalian-french colonial beautiful - schenzen 10mio not on map - huawei - surfboard factory in special sealed drainage zone - china is organising properly. Slave labour is now only in few places, all modern factories are 1a planned. 12:08 i'm in auckland. It's VERY prettty sky, water and it smells of strawberry. We westerners are snobbishly denigrating china habitually. That is my opinion,too. Case in point: i tell mike an he is off on a tangent about milk powder' and how new zealand's milkpowder exports to china are up (see below) because "nobody trust theirs anymore". Ho hum. Brasil is another great country to life in, wayne says. "the girls are pretty"...

NZ supermarkets ration baby formula due to Chinese buyers

January 15, 2010 by Shawn Douglas

chinese_baby_drinking_formulaNew Zealand supermarkets are rationing baby formula due to Chinese-New Zealanders buying it in bulk and selling it online to worried parents in China.

Chinese living in New Zealand have been selling baby formula online to Chinese citizens for months, taking advantage of widespread fears of contaminated formula in China.

Many people in China are still wary of Chinese-made formula after it was found that company San Lu had manufactured formula contaminated with melamine in 2008. The contamination was linked to the death of six children and illness in 300,000 children in China, leading to the bankruptcy of the company and the execution of two company officials.

Supermarkets like Countdown and Woolworths have caught on to the bulk purchases and set a strict four-can limit on formula purchases.

A spokesperson for Progressive Enterprises, the company that owns the supermarket chains, told the New Zealand Herald, “It’s pretty much a response to unfairness that we had with a lot of people stockpiling baby formula and selling it overseas. We appreciate why people are doing it, but our supply is for the domestic market.”

The New Zealand Herald interviewed Bruce Liu who runs a warehouse in Manukau City. Liu has been selling New Zealand-made Karicare baby formula over the Internet since last April. Using Web sites like, Liu claimed that he’s been able to sell nearly 100 boxes of formula a week, profiting nearly $6,000 a month. But the recent store restrictions have slowed him down.

“So 80 percent of our time is spent going over all the supermarkets [to buy baby formula],” Liu said.

The Herald also interviewed Andy Liu (no relation to Bruce Liu) who has been selling five to ten boxes of formula a week on, making $10 profit on each box. He also said that the store restrictions made things more difficult for him. Despite the restrictions, Bruce Liu still sees a demand.

“Because of what happened in China, with San Lu, people want New Zealand baby formula,” he said.

The Otago Daily Times reported that the New Zealand Food Safety Authority (NZFSA) was unaware of the thriving trade until the New Zealand Herald broke the story. As all food exported from New Zealand requires an export certificate from the NZFSA, there are additional concerns being raised about the practice.

“If it is a commercial venture and they are not getting certification from us, then its something we’ll look at,” said NZFSA senior program manager Neil McLeod.
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Friday, January 15, 2010

Sea side western coasr sunset mid january

The ides of january display a imperfect sunset on new zealand's westcoast of the far north - a beach that has swallowed lots of cars - stuck in the sand, a public road, and sunk into the shoreline.
Ninety mile beachroad photo, sunset is copyright free, but the image is not. Postcard pretty it aint, yet it tramsports a mood, a brief feeling of that moment that is a mystery to science how to explain how i feel.
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Wednesday, January 13, 2010

Sunset over the Lake

it is 20:39 and the earth is turning away from the sun.
To reappear in due course on the other side.
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Tuesday, January 12, 2010

internet porn acceptablER THAN PIRATE MOVIES

Porn 'more acceptable' than pirated videos: survey
11:50 AM Tuesday Jan 12, 2010

Three times as many New Zealanders think it is morally acceptable for a single person to view pornography on the internet than to download copyrighted video, according to a new poll.

The survey also indicates gender differences in what is morally acceptable behaviour, with women being overall less approving of viewing pornography, using dating services, downloading copyrighted material and flirting with others on the internet.

The results are the second in a series of UMR polls on morality. One thousand New Zealanders were surveyed online in November.

A_26082006HOSDSEROTICA3561_220x147.jpg (220×147)

The poll indicated 41 per cent of New Zealanders think it is morally acceptable for a single person to view pornography, compared with 13 per cent who see downloading copyrighted video as acceptable and 18 per cent who consider downloading copyrighted music acceptable.

Twenty one per cent thought it was morally acceptable for a married person to view pornography online without the knowledge of the person's spouse.

tw1_.jpg (500×375)

Although 69 per cent thought it was acceptable for a single person to flirt with another internet user, just 6 per cent thought it was morally acceptable for a married person to flirt with another internet user without their spouse's knowledge.

LorLee.jpg (482×500)

The survey showed up substantial gender differences. Fifty-six per cent of men thought that it was acceptable for a single person to view pornography online, compared with 26 per cent of women.

Similarly, 31 per cent of men were comfortable with married people viewing pornography online without the knowledge of their spouses, compared with just 10 per cent of women.

tera_ralph_3_big.jpg (297×400)

The survey also showed that seeing music and video downloads as morally unacceptable did not necessarily prevent people from making such downloads, with substantial proportions of those who have downloaded music or video from unofficial sites nonetheless saying that such activity is morally unacceptable.

The margin of error for the survey was plus or minus 3 per cent.


porn3.jpg (704×396)

Wellington, Jan 12 (ANI): A new survey has shown that a lot of New Zealanders think it’s more acceptable to download porn than to illegally download copyrighted material.

According to the UMR Research survey, 41 percent of Kiwis think that it is morally acceptable for a single person to view pornography, compared with 13 percent who see illegally downloading copyrighted video as acceptable and 18 percent who consider illegally downloading copyrighted music acceptable.

Twenty one per cent think it is morally acceptable for a married person to view pornography online without the knowledge of the person’s spouse, reports

Although 69 percent think that it is acceptable for a single person to flirt with another Internet user, just 6 percent think it is morally acceptable for a married person to flirt with another Internet user without their spouses’ knowledge.

The survey showed up substantial gender differences. More than 50 percent of men think that it is acceptable for a single person to view pornography online, compared with 26 percent of women.

Likewise, 31 percent of men are comfortable with a married people viewing pornography online without the knowledge of their spouse, compared with just 10 percent of women. (ANI)

i_symbol_porn_tshirt-p235078598285839227q6v8_400.jpg (400×400)

Washington, Dec 2 (ANI): A University of Montreal researcher refutes demonization of pornography, insisting it is overly criticized and doesn’t change men’s perception of women and their relationships.

During the study, Simon Louis Lajeunesse, a postdoctoral student and professor at the School of Social Work recruited and interviewed 20 heterosexual male university students who consume pornography.

“The objective of my work is to observe the impact of pornography on the sexuality of men, and how it shapes their perception of men and women,” said Lajeunesse.

“They shared their sexual history starting with their first contact with pornography, which was in early adolescence. Not one subject had a pathological sexuality. In fact, all of their sexual practices were quite conventional,” he added.

Lajeunesse found that 90 percent of pornography is consumed on the Internet, while 10 percent comes from video stores.

On average, single men watch pornography three times a week for 40 minutes. Those who are in committed relationships watch it on average 1.7 times a week for 20 minutes.

Most boys seek out pornographic material by the age of 10, when they are most sexually curious.

However, they quickly discard what they don’t like and find offensive. As adults, they will continue to look for content in tune with their image of sexuality. They also rarely consume pornography as a couple and always choose what they watch.

internet_porn_tshirt-p235321978836714428trlf_400.jpg (400×400)

The test subjects said they felt victimized by rhetoric demonizing pornography.

“Pornography hasn’t changed their perception of women or their relationship which they all want as harmonious and fulfilling as possible,” said Lajeunesse.

“Those who could not live out their fantasy in real life with their partner simply set aside the fantasy. The fantasy is broken in the real world and men don’t want their partner to look like a porn star,” he added.

Lajeunesse refuted the perverse effect often attributed to pornography.

“Aggressors don’t need pornography to be violent and addicts can be addicted to drugs, alcohol, gaming and asocial cases are pathological. If pornography had the impact that many claim it has, you would just have to show heterosexual films to a homosexual to change his sexual orientation,” he added. (ANI)

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Es ist ein wenig kuehl...

Bin im hohen Norden und sitze am Seeufer mit Sonnenuntergang.
Ein Foto sagt tausend Worte, also ist eins angefuegt.
Es ist etwas kuehl. Die Voegel machen komische Geraeusche.
Gruesse vom See!
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Monday, January 4, 2010

New Zealand - Corruption High Finance Crime

Tony Molloy's book, Thirty Pieces of Silver. (Howling at the Moon Productions, 1998)


o The Dunedin Star Weekender:

"The book is riveting, reading at times like a whodunnit. Even though high finance is way beyond my ken I was captured by the plausibility and the logic demonstrated by Anthony Molloy in setting out his case. . . I was drawn from page to page like a puppet on a string. This is an extraordinary book and it will have a major impact on the legal fraternity. Much more will be heard of it in the coming months and years."

o North and South:

"An impassioned . . . consistently courageous attack on the role of legal megafirm Russell McVeagh McKenzie Bartleet & Co in the sham loans, inflated movie budgets and tax avoidance schemes of the 1980s. The book should be a recommended text in our law schools."
o Wellington City Voice:

"Tension mounts as one shocking allegation follows another in this fascinating legal exposé . . . worth its weight in silver."
o Napier Daily Telegraph:

"The most grave public allegations I have ever read . . . the legal profession must be, at the least, devastated by Dr Molloy's allegations and the public must seriously determine whether to trust their lawyers again."
o Waikato Times:

"The hardest hitting book ever published in New Zealand."

===== Amazon Review ====

Lawyers, Ethics, and Tax Fraud, February 8, 2009

By Andrew L. Cawston "vimaster" (New Zealand)

Well respected throughout the Commonwealth, Anthony P Molloy QC is New Zealand's leading authority on Tax Law. In "Thirty Pieces of Silver", Molloy examines the events surrounding New Zealand's infamous "Wine Box" tax frauds of the 1980's, and in particular he examines the legal ethics of one of New Zealand's premiere law Firms in setting up, administering, and then covering up the transactions that made up the "Wine Box".

Molloy pulls no punches, but instead makes serious allegations, challenging both the reader to understand the scope and nature of often complex transactions, as well as challenging the law Firm to respond. Molloy names names and makes specific accusations -- this would have been a very brave book to write, requiring Molloy to be absolutely dead-certain of each of his facts, at peril of finding himself on the wrong end of defamation suits. It is seldom that such books are written.

Despite the weighty subject matter -- tax law -- Molloy writes with entertaining charm and wit: evidently the product of an excellent Catholic education. He sets his book out in much the same way as a prosecution attorney would set out his case, building it carefuly from the ground-up, each brick of evidence building upon the previous ones, cementing them in place carefully with facts, legal precedents, quotations from leading legal authorities, and chapter-and-verse from the Law.

It is fast-paced reading, and it requires absolutely no knowledge of New Zealand Tax Law to appreciate. Molloy's writing is accessible to anybody with some spare reading time on their hands.

By the time the reader has finished this book, the reader is left with the clear impression that one of New Zealand's premiere law firms was complicit in planning and executing a series of very ambitious and illegal raids on the Revenue of countries around the world. These scams used fake transactions to produce fake tax receipts, which were issued by overly-compliant tax haven in the Cook Islands. The vehicles for these fraudulent transactions were B-Grade movies and thoroughbred horse bloodstock (often involving horses that did not exist).

As a matter of natural justice, it would be most interesting and instructive to read and review a similar work written by an author of similar stature and professional standing to present the case for the defense: however, we are not aware of such a book having been written. This is a pity because it is always disappointing to know only one side of a story -- however well presented that side of the story may be.

We must thereore be satisfied with Molloy's excellent work, and resolve to give equal time and attention to reviewing any such future response when and as it may become available.

In this book, Molloy's love and passion for the majesty of the Law in general and Tax Law in particular is obvious. It is also infectious: one leaves this book with a whole new Respect for the Law and for ethical Lawyers who serve the Law -- as well as for a deep and well-founded suspicion of and contempt for Lawyers who choose to be Client-Driven rather than Principled, and thereby sell their ethical birthright for Thirty Pieces of Silver.

This book belongs in every law library as a salutory lesson for Lawyers and Professionals worldwide.


Issue 201 of Offshore Investment magazine features an explosive article by the highly acclaimed Anthony Molloy QC:

"Cuckoos in the nest in an otherwise promising trust and investment jurisdiction"

Anthony Molloy exposes New Zealand's lunatic proclivity for government by micromanagement and reveals astounding inadequacies in the way New Zealand's court system deals with trust matters. He argues that if New Zealand wants to back its claim to be a serious trust jurisdiction, it has much catching up to do.

The main feature of this month's magazine is Special Purpose Vehicles in which Prof. Charles Cain demonstrates evolving techniques in asset protection planning. He examines trust structures and identifies certain drawbacks in their use, not least the complexities of equity. He reveals how other forms of structure can be used, in particular, a Limited Liability Company. Frédéric Mege provides a detailed overview of the Tontine, an old institution which has been used, since the middle of the 19th century, as a scheme for raising capital which combines features of a group annuity and a lottery.

Jurisdictions in focus:

NEW ZEALAND - A new era of greater transparency is already with us. William Patterson elaborates on the considerable advantages, in the light of increased transparency, in using a country such as New Zealand as the place of administration of trusts for non-residents.

CURAÇAO - Xandra Kleine highlights consequences of the recent changes to profit tax legislation in Curaçao and discusses the soon to be operational Dutch Caribbean Securities Exchange.

ARUBA - Lincoln Gomez writes about recent amendments to Aruba corporate law, analyses Aruba tax law and explores aircraft registration in the jurisdiction.

LUXEMBOURG - Jean Schaffner identifies some interesting residency opportunities available in Luxembourg for high-net-worth individuals and Francis Hoogewerf promotes Luxembourg.s success in the financial world and provides an update on Luxembourg.s array of corporate vehicles.

ANTIGUA - Brian Stuart-Young contemplates how the combination of well-regulated financial service providers and the ability to offer modern financial services in a stable environment makes Antigua and Barbuda an attractive jurisdiction for global business.

Regular features include World Report, Dubai Digest and Latin Letter.


Emeritus Professor Richard Sutton

I have been a member of this faculty since 1980, and before that I taught law at Auckland University for 15 years. During my time in the law, I have tried my hand at a lot of things - including conveyancing, opinion work, and law reform. I often draw on these experiences in what I do now. Yet for me the most important thing is still teaching and legal research. There is a fascination in the way the law works, and how lawyers go about everyday tasks. I want to get beyond the rule or principle I am studying, to find out how it really ticks! What kind of things make judges do what they do, and how does everything fit together? I find in this, not just more refined legal ideas, but also moral principles and pre-logical symbols. I am quite often surprised by what I come across.

My main interests have always been in private law, particularly the principle of "unjust enrichment". This is relevant most frequently in the law of contract, the law of restitution and in commercial law situations (such as bankruptcy) where there are conflicting claims to property. The basic idea is that if you are enriched as a result of something another person has done - often inadvertently, no-one is to blame - then you ought to give the benefit back. For example, if I pay money which we both think I owe to you, you have to give it back if it turns out later that I didn't owe the money in the first place. We don't need to worry whether you promised to give it back, or did anything wrong in order to acquire the benefit. There is a strict legal obligation to pay back the money.

In the last few years, I've also been thinking about how different legal systems work. On my leave in 2001, as well as working in England, I spent time South Africa, France, Quebec and the Czech Republic. I am also very privileged to have an association a project called "Te Matahauariki" at the University of Waikato, where they are looking at the fundamentals of law from a Maori perspective, and working towards a genuinely bi-cultural set of laws.

Although I'm now 'retired', I am still teaching Creditors' Remedies, as well as being a grandparent (by distance learning!), playing chess, being a member of the Anglican General Synod, and playing classical music on the piano (indifferently). Oh yes, and generally making myself agreeable around the place - so I welcome casual visitors!

Recent Publications

Richard Sutton, .Mistake: Symbol, Metaphor and Unfolding. (2002) Restitution Law Review 9.

This article asks the question, .Can someone be said to have paid money under s .mistake. if they could not have known the truth at the time of the payment?. The payment in question, and discussed in an important House of Lords. decision, was made at a time when no-one knew what the law was. People did not even think that there was a legal question involved. Later on, the courts ruled that the paying company had no obligation to pay the money. The payer could not have known that this would be the outcome, even if it had sought expert advice. Conventional wisdom would say that a .mistake. is something human, an error that could have been corrected.

My article probed more deeply into the nature of .mistake. as a head of legal liability. I argued that the term served symbolic purposes, at a highly abstract level of meaning. The symbol (or metaphor) of mistake is conceived at the abstract level. It .unfolds. as judges choose subheadings, from a variety of meanings that could grow out of the symbol. Only after that do they reach the framing of ordinary rules of law. The conventional view of .mistake. is aimed at the wrong level of legal discourse.

The judges who decided that there was a .mistake. in these circumstances, made a wise choice because the larger notion of invincible, inevitable .mistake. was more valuable as a symbol, than the narrower notion of human error. King Oedipus, for example, who unknowingly killed his own father and married his own mother, stands forever as an example of this larger kind of mistake. He had to bear the consequences even though he had no means of finding out the truth. So too does the payee of money, who receives it in a situation where his or her right to take the money cannot be known until later.

Richard Sutton, ..We Just Mislaid It.; The Great Project and the Problem of Order in Private Law. (2005) 11 Otago Law Review 97

This article, though supposedly my .valedictory lecture., has set me off on a whole new mode of enquiry. It explores the puzzle of order in private law . how did we stumble across our fundamental divisions of law, our basic notions such as .contract?, .unjust enrichment. and .tort.? What standing do these ideas now have in our law? Again, the question of symbols or metaphors comes up - should we expect our heads of law to have definite meaning, which are elaborated further by the subsidiary rules? Or are they more like beacons, good to steer towards (up to a point) but useless in mapping out the detail of the law?

I argue that conventional notions of .order. in private law tend to distort the reality, by looking too earnestly for meaning and not attentively enough for the symbolic function of headings such as .mistake., .undue influence. and .frustration.. A new .diagram. of the legal process is offered, which is sensitive to the dynamic process of movement from headings to legal rules and results.

Current work

My present work follows on from these two articles. I have been working on the idea that there is a dynamic structure in law, comprising three distinct discourses:

* .the actual. (the texts of the law, ie what is said in statutes and decided cases)
* .meaning., that is to say, the process of extracting some sensible set of legal principles from the actual
* .the possible., that is to say, an overview of the law which determines conclusively the way we look at the actual and give it meaning.

I am trying to show that these three modes of discourse are present in even the most rationalistic legal enterprise. There is also, at each corner of the triangle formed by these three modes of discourse, a .gap. which tends to undermine the rationality of the whole enterprise. It is here we encounter the .transcendental., that aspect of law which is beyond the reach of conventional, professional discourse, though possibly open to exploration by non-conventional means, and by interdisciplinary study.

Research Interests

Commercial Law, Bankruptcy and Creditors' Remedies, Unjust Enrichment, Law Reform, Estates and the Law of Succession, Maori Succession

Contact Details Tel 03 479 8845


27 January 2005 Otago
Task Force on Regulation of Financial Intermediaries
P O Box 25-154 Panama St WELLINGTON Attention: Kathryn Gabites
Dear Ms Gabites
Thank you very much for the opportunity to comment on the work of the Task Force
at this early stage in proceedings.
My interest in your topic arose through my academic research. I have a particular
interest in the financial intermediary as a fiduciary. This interest relates less to the
detail of regulation, and more to the underlying duties of fiduciaries and others. In
particular, what duties do they have
(a) Not secretly to sell or buy property to or from the person whom they
are advising, or to take secret commissions;
(b) Not to use, to their own benefit or the benefit of others, information
which they have acquired in confidence from the person they are
advising; and
(c) Generally (in situations of conflict of interest) to disclose all
information in their possession which may be material to decision
being made by the person they are advising.
In 1990, Sir Alexander Turner and I updated an English text on the subject,
Actionable Disclosure by Mr George Spencer Bower, written in 1915. Our new
edition was published in London by Butterworths. Chapters 18 and 19 dealt with
company directors, promoters and prospectus requirements.
I have, by contrast, very limited knowledge of the business of financial
intermediaries, though I have had (for the last ten years) personal experience of
investing with the assistance of share-brokers. I have invariably been happy with the
service I received, though aware of the limits of my own abilities in investing and the
way in which a share-brokers may wear several "hats" in a given transaction.
The above caveats explain why I have chosen to confine myself to only a few of the
48 very pertinent questions your Initial Issues Paper raises, and to direct my
comments mainly at the end product of the exercise. The end is presumably
legislation which imposes new or clearer liabilities on persons defined as "financial
faculty of Low
PO Box 56, Duneliin, New Zealand.
Tel 64 3 479 8857 . Fax 64 3 479 8855 . Email

1. Including and excluding particular activities from the legislation.
It is inevitable that some activities will be excluded from the legislation which
logically might easily be there, and some activities will be included where those who
engage in them will find the additional liabilities uncomfortable. From the point of
view of legislative design, a lot depends on how different the new law is from the old.
If the basic underlying principles remain the same for both, but the policing or
enforcement is more specialized, there is less of a problem. There is a more of a
problem, which requires good policy justification, if the two sets of liability are
fundamentally different.
I have some difficulty (in practical terms) with the distinction you draw (in para 1.8)
between issuers and promoters. A good legal definition of "promoter" is "one who
undertakes to form a company with reference to a given project and to set it going,
and who takes the necessary steps to accomplish that purpose". Nowadays this task is
usually undertaken by the directors. But the term "promoter" was needed because, in
earlier times, promoters would often not become directors. On incorporation of a
company, they would slip back into the woodwork with a large profit, leaving it to the
directors to cope with the results of their handiwork. Similar duties had to be
imposed on them, as were imposed on the promoting directors. So it would be very
odd to impose obligations on promoters, but not on promoting directors.
I think the main concern should be a pragmatic one - is there a broad sector of the
public who is served, in a broadly similar way, by various groups of people who can
justly be made to shoulder the costs of a common investigation and redress system?
3. Should some activities be excluded from the preliminary definition?
I suggest that your preliminary definition may be too wide to be workable. This is
most apparent from the definition of "financial product", (para 1.4) Lots of things
are sometimes marketed with a view to "investment", ie long term capital gain. They
include not only houses, which are instanced in your paper, but also works of art,
antiques and collectibles such as stamps and Beatles tee-shirts. If you include all
these things, your legislation may become too wide and general (just like the general
law). The main advantage of legislation in the financial intermediary territory alone
is that it can be tightly focused and specific. Besides which, I doubt whether art
dealers would welcome sharing the cost of investigating company fraudsters!

16. The focus of the Task Force - accurate information
My suggestion would be that the most helpful starting place is the existing general
law, in particular the duty of those "in trade" not to make misleading statements
(which it appears can include omissions, at least where the omitted fact is known to
the adviser). (Fair Trading Act). This duty is imposed in the form of a general
standard of conduct, which is open to different application in different industries.
Traditionally the securities industry has been regulated by reference to "lists" of
things which must be correctly disclosed (going back to nineteenth century prospectus
requirements). But these are of limited value to the ordinary investor, who relies
(with justification, in my experience) on the wisdom of the financial intermediary to
sift through a mass of compulsory material to find the kernel.

More important are the "independent" reports on particular companies, which are
compiled for share-brokers, and which include estimates of companies' future
financial prospects. One is very much in the hands of one's share-broker as to
whether these are genuinely independent and reliable. But as long as the share-broker
has acted honestly and reasonably in advancing these reports, I don't think an investor
can complain. The greater difficult is how to get information if the report turns out to
be badly wrong, or isn't as independent as it purports to be. Perhaps there is a case
for an Investment Ombudsman who can look into such matters.
Maybe the independent report model is one which should be encouraged for other
financial intermediaries as well, eg as regards insurance. Of course, very long term
financial products like insurance policies always run the risk of change in
management - one of my own life policies seem to have run through about five
insurance companies so far, each one less effective and interested in me than the last!

But there we are.

18. The focus of the Task Force - conflict of interest.
In your para 2.3, subaras b), c) and d), you identify issues which are very close to my
own research concerns. To what extent are financial intermediaries who have
conflicts of interest, obliged to observe the general duties of fiduciaries?
This is a particular concern in relation to "tied" insurance and investment advisers,
and to share-brokers who act for buyers and sellers in the same transaction. As I
understand the general law, a fiduciary must do more than simply disclose the vague
possibility of such conflicted relationship. He or she may have to explain the
particular relationship and its nature (the mere "I get a commission from the AB Life
Co" may not be enough - what is the commission and on what basis is it paid?).
He or she must also dispel any possibility that the dual relationship has been misused.
This can be done, either
by referring the client on to another adviser (or firm) for independent
advice, or else
by undertaking the duty of full disclosure of all material information in
the possession of the intermediary, allowing the client to make up their
own mind whether to enter into the transaction.
By and large, in my limited experience, these obligations seem not to be observed by
financial intermediaries. One never knows the basis on which a life insurance
salesman is paid a commission. Contracts with share-brokers may notify you that the
share-broker may have interests conflicting with yours, presumably making it a tenn
(whether legally enforceable or not, I am unsure) that you will not insist on the
ordinary legal rights you would have against a fiduciary.
I have an open mind as to whether this is not (a) inevitable and (b) by and large a
good thing, as long as it does not affect the quality of the general advice I am getting.
It certainly has never troubled me personally. But I wonder whether financial
intermediaries need to trade something back in to the equation, in return for this
departure from the general law. Breach of one of these fundamental obligations would
normally be seen as a "flag" for a matter which needs investigation. Perhaps, in place
of the existing law, other markers should be established (eg, a sudden rise or fall in

the value of the investment, within a specified time of the transaction; or a subsequent
event occurring soon after the transaction, which makes a life policy quite
inappropriate) which would trigger an official investigation into trading in that
In fiduciary law, if one of these rales triggers an investigation, the onus of proof
passes on to the fiduciary to show that he or she acted honestly and fairly. Might the
substitute statutory trigger raise a comparable presumption against the intermediary?
21. The focus of the Task Force - where things do not work well,
I have a general concern which is not limited to financial intermediaries. It is the cost
of legal proceedings, especially where groups of litigants are concerned and the
defendant is a substantial institution with the ability to drag things out interminably
and expensively. This tendency is encouraged by law firms which take pride in their
skill on exploiting the situation. See Tony Molloy's book, Thirty Pieces of Silver
(Howling at the Moon Productions, 1998), where the defendant was itself a large law
firm - though I am sure there is another side to the story. Investment history in New
Zealand has famous examples (eg the Omnicorp case in the 1980's) where on the face
of it something was seriously wrong, but nothing seemed to happen.
This concern is rightly foreshadowed in subparas 2 h), and i) and in my view
deserves serious attention. Normal litigation is cripplingly expensive, and "derivative
suits" brought by numerous shareholders don't seem to have taken off in NZ. There
is a risk that effective financial intermediary regulation will pick off the small
intermediary, without getting to the root cause of a more widespread problem. Yet the
fact that many shareholders will be involved and the total amount at stake large,
would seem to offer - through appropriate legislative facilitation - economies of scale
in the investigation.
What seems to be needed is an Investment Commissioner who can
(a) Educate the general public about what to expect, and what not to expect,
from investment transactions;
(b) Perform an Ombudsman role for minor, one-off problems between
financial intermediaries and their clients;
(c) Investigate, in the collective interest of all those affected, problems
occurring on a larger scale.
Probably I am sticking my neck out without proper support for it, but I am less
persuaded that either penal enforcement, or penal damage awards (eg, the US "treble
damages" claim) have a great deal to offer in our environment. These are likely to
attract "reasonable doubt" type of standards (in practice if not in law) which lead to
long drawn-out trials with the end result very much a matter of chance. But perhaps
the Task Force might commission work on the US scene, to see if such procedures are
effective, and if so why; and then ask, whether the things that make them work there
could operate here also.
You will no doubt be aware of the paper the Law Commission has written on the
structure of the courts, and the possible integration of other law application bodies
within that system. I hope that your own proposals will link in with the Law
Commission's suggestions.

I trust these comments will prove helpful, as the Task Force begins to develop the
shape of its investigation.
Richard Sutton

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New Zealand Wine copper german customs scandal

Most wines pass EU's copper test

By Patrick Gower

5:00 AM Saturday Dec 1, 2007

A New Zealand winery whose shipment of pinot noir was rejected by Germany because it contained too much copper has bottles with similar levels for sale here.

The Te Kairanga 2006 Pinot Noir on shop shelves has 2.09 parts per million (ppm) of copper in it - more than double the recommended limit set by the European Union. But New Zealand has no set limit for copper in wine and the Food Safety Authority says wine drinkers need not be concerned.

The Weekend Herald had the copper levels of 10 wines tested after it was revealed that a 4000-case shipment of Te Kairanga pinot noir was turned back by a German company that found its 2.4 ppm of copper breached the European Union limit of 1 ppm.

The testing found that all but the Te Kairanga pinot noir were within the European limit.

Te Kairanga acting chief executive Ian Frame said it was "no surprise" there was a high level of copper in another of its wines - they were similar wines and copper was added to take away the smelly characteristics associated with the sulphur compounds formed in the winemaking process.

Article continues below

Mr Frame said the copper levels were within the good manufacturing practice standards set by the Food Safety Authority, which say copper "should be kept as low as reasonably achievable".

"There isn't a safety issue, and we don't have an ethical issue," Mr Frame said.

He said Te Kairanga had not decided what it would do with the returned wine.

Food Safety Authority principal toxicology adviser John Reeve said the authority had examined the safety of adding copper to wine this week after the German rejection and there was no associated health risk with copper - an essential element for humans - at levels of around 2 ppm.

"You would need at least 200-300 parts per million before you got above the acceptable daily intake," Mr Reeve said. "The wine would be blue and it would probably have a metallic taste too, which wouldn't go down too well."

Copper is not routinely checked for export certification in New Zealand. Nor is copper checked in wine for sale in the New Zealand market.

Industry body New Zealand Winegrowers is unconcerned about the rejection, saying the German market is "pedantic about rules and regulations", with the addition of copper in wine a long-standing technique.

Wine writer and critic Keith Stewart, who revealed the wine had been rejected from Germany, said consumers had to ask themselves if they were happy with the industry self-regulating the use of additives in wine.


* Small amounts of copper are sometimes placed in batches of wine to remove the smell of sulphur that can occur in the winemaking process.

* Copper can also occur naturally. What are the health effects?

* Copper is actually a daily requirement for humans. The amount in wines could actually help fulfil this.

* An overdose could cause serious problems such as liver damage and kidney failure.

* However, the less severe overdose symptom of vomiting is likely to prevent too much being ingested.


NZ wine rejected over copper
By Martha McKenzie-Minifie
5:00 AM Monday Nov 26, 2007

A New Zealand winery's 4000-case shipment of pinot noir has been rejected by a German company because it said the level of copper in the wine was well over the European recommended limit.

The incident has worrying implications for New Zealand's $700 million export wine industry and has put the spotlight on the use of screwcaps on wine bottles.

It is understood the copper levels in the Te Kairanga pinot noir were 3.6 parts per million (ppm) in a wine that was bottled and labelled specifically for the German customer.

The European Union standard for copper residues is 1ppm.

It is possible other exported wines do not comply with residue levels, as copper is not routinely checked for export certification in New Zealand. Nor is copper checked in wine for sale in the NZ market.

Te Kairanga acting chief executive Ian Frame said the wine did not meet the customer's strict requirements but he was unable to provide details.

He was not concerned about the rejection. "The product is not branded Te Kairanga, and in all the other countries we deal with this is not a problem."

Article continues below

New Zealand Wine chief executive Philip Gregan said he was not worried that the incident would blemish New Zealand wine's reputation internationally. Germany was known as a "stickler for technical points" in the wine world.

"They are just very pedantic about rules and regulations," said Mr Gregan. "If there's an issue that comes out of a customer in Germany, it never surprises me."

Copper is required in small quantities in humans but an overdose can cause serious problems such as liver damage and kidney failure. Less severe overdose symptoms include vomiting and problems with co-ordination or movement.

In the wine industry, copper is often added to wine as it eliminates smelly characters associated with organic sulphur compounds that can form during fermentation and bottle ageing.

Traditionally it is added to bulk wine at very low levels and is filtered out before bottling.

Some industry sources say its use became more common as screwcaps increasingly replaced corks.

"Everybody was adding far too much when they first started using screwcaps," said Bruce Kirk of the food chemical supply company Scios. "That has eased off now, and if anything copper use is going down."

But Lincoln University food and wine group leader Dr Roland Harrison said copper had been used for years and he did not believe there had been a screwcap-driven rise.

* Additional reporting - Keith Stewart


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