Two former public servants who worked for the Canterbury Earthquake Recovery Authority (CERA) have been found guilty on corruption charges.
Former CERA employees Gerard Gallagher and Simon Nikoloff tried to use information obtained through their roles in order to profit from the earthquake rebuild in Ōtautahi/Christchurch.
Serious Fraud Office director Karen Chang said the two men were employed to help Christchurch recover post-earthquakes.
Both were investment facilitators at CERA, tasked with attracting investment to the central city and eliminating barriers for development.
CERA was established to speed up Waitaha/Canterbury’s regeneration and to help streamline Christchurch’s rebuild, which then became Ōtākaro Limited in 2016.
The pair then became involved in finding potential buyers for unused Crown land.
Chang said the pair abused their power, knowing what investors were willing to pay and what future plans were in store for the city rebuild – essentially insider knowledge.
They “attempted to set up private business deals in an effort to profit by hundreds of thousands of dollars,” said Chang.
Despite their “unfair advantage” it didn’t work out for the duo.
The Serious Fraud Office laid charges relating to “obtaining a commercial advantage” from privileged access to official information.
Gallagher was found guilty on three charges of corrupt use of official information while Nikoloff was found guilty on one charge of corrupt use of official information and not guilty on one charge.
“Seeking to profit personally from information obtained in a public role is corrupt, regardless of whether they were successful,” Chang said.
Chang argued the case highlights the importance of carefully managing conflicts of interest around public funds.
“The SFO will continue to investigate and prosecute cases which have the potential to undermine trust in our public service and threaten the success of projects which are intended to benefit New Zealand, including in times of disaster recovery.”
The Serious Fraud Office (SFO) was established in 1990, and is the main law enforcement agency investigating and prosecuting complex financial crime.