Accused ‘collateral damage in manhunt’

A Nelson man prominent in the hospitality industry was collateral damage in a Department of Internal Affairs ‘‘manhunt’’, a lawyer says.

Paul Anthony Max, 60, is one of three men on trial in the High Court at Wellington in a case that centres on the alleged role of Blenheim harness racing personality Michael Joseph O’Brien in pokie machine venues, and deciding who got the profits.

As a result of his earlier position in a charitable trust that distributed pokie machine profits, the Department of Internal Affairs deemed O’Brien ‘‘unsuitable’’ for the industry.

In a trial that has lasted about two months, O’Brien is accused of hiding from the department his interest in three pokie machine sites by having Max hold shares on trust for him. O’Brien is also alleged to have been behind the Bluegrass Trust, which owned machines and distributed the profits with a primary aim of helping racing clubs.

O’Brien was said to be earning more than $1 million a year as a ‘‘lobbyist’’ for racing clubs wanting money from Bluegrass and other trusts. The charges did not relate to the money from lobbying.

O’Brien, 57, Max, and a 56-year-old man, whose name is suppressed, will not know their fates until mid-June, when Justice Robert Dobson is expected to deliver his verdicts.

O’Brien faces five charges, Max three, and the other man two charges. Each has pleaded not guilty to the charges, which date from between 2009 to 2013.

Max’s lawyer, Marc Corlett, QC, spoke last at the trial. He said Max had legitimate reasons to hold the shares on trust in the businesses, and did not think there was anything wrong with that.

Three others also held shares for O’Brien or an associated party on trust and were not charged with any offence, Corlett said. If it had been suggested that the department would have been deceived, Max would have had nothing to do with it.

Corlett said Serious Fraud Office investigators had arrived at Max’s home at 7am and they started asking questions about events six or seven years earlier.

Max had been collateral damage in one of the most extensive inter-agency investigations in New Zealand criminal history in what Corlett – with what he called poetic licence – described as a ‘‘manhunt’’ begun by some in the Department of Internal Affairs who had taken exception to O’Brien as a result of the earlier inquiry.

There were sound commercial reasons for Max to hold shares on trust in each instance. Each trust arrangement was properly documented by a lawyer.

There was no evidence that Max knew the department’s attitude to O’Brien operating venues for pokie machines.

Max knew O’Brien resigned from the trust and that O’Brien was not charged with any offence.