Tanczos Nandor: Urgent Debates — Tranz Rail Shares—Insider Trading 
Tanczos Nandor: Urgent Debates — Tranz Rail Shares—Insider Trading 
[Volume:640;Page:9961] 
NANDOR TANCZOS (Green) 
: 
 This settlement I think will be greeted enthusiastically by New Zealanders all over the country. Many of us are still shell-shocked by the events of that time and we look back in wonder at the way that the New Zealand public and New Zealanders were ripped off by yuppy wide boys aided and abetted by the Governments of the day. We look back in amazement that that kind of thing went on and that it happened with the total connivance of the Government. So this development is welcomed as an indication that people cannot continue to get away with the kind of corruption—and I think we have to call it that—that we saw at that time with absolute impunity. They cannot get away with it scot-free. 
Nevertheless we have a fairly limited victory I guess because this is not a judgment of the court; it is an out-of-court settlement recognised by the court. The protagonists do not accept liability although we have to say that most New Zealanders think it is pretty obvious that there was insider trading. It is pretty obvious that we are talking about corrupt practice. As Mr Peters said if the protagonists were not guilty why are they giving the money? It is not because they have had a sudden change of heart and are stricken by an overwhelming concern for the well-being of those shareholders who lost out so badly. 
Why are they doing it? Actually it is quite interesting to look at the report in the media today. We see Mr Richwhite and Midavia’s lawyer Bell Gully partner Roger Partridge said: “It had been a commercial decision to settle the case. The case wasn’t set down to go to trial until the middle of next year. With the prospect of appeals on either side they could have been fighting it for another three years.” That is curious because appealing spinning the case out and keeping the court process going in order to avoid having to deal with the case has been the tactic used in the past. We have to look at the reasons now given and wonder in awe. We have to look in awe and in admiration at the sheer audacity of the kind of rationale that is being given. 
So this is not a judgment of the court; it is a settlement of $27.5 million - odd. Even though that is a limited victory I think we have to give our congratulations to the Securities Commission. We have to congratulate the commission because in the past there have been some stunning defeats of the Serious Fraud Office—and that has been referred to by members—and a reluctance to get into this kind of litigation. In a way that is with reason because there have been some real difficulties in the past. We have to give our congratulations to the Securities Commission on this settlement and on what is according to the media the biggest settlement in a case of this kind in Australasia. It is good stuff. I understand that this is the first time that the Securities Commission has taken court action against alleged insider trading. Although the penalties it sought were quite a lot higher than the settlement finally came out at it is still an important signal as I said that people cannot get away with this kind of outrageous rip-off with impunity. 
Nevertheless we cannot help but wonder a little about a couple of things. The first one arises from a comparison of the settlement with the estimated half a billion dollars that Fay and Richwhite made—personally gained—from a range of transactions as they ram-raided the New Zealand economy. It was estimated at half a billion dollars—and there was an estimated $277 million loss by the minority shareholders. So although this settlement is a victory I think we have to keep it— 
Ron Mark 
: We picked their pocket. 
NANDOR TANCZOS 
: Mr Mark said that we picked their pocket. I think we have to keep it in context. 
Ron Mark 
: We got their loose change. 
NANDOR TANCZOS 
: Yes that is right; we got their loose change. 
The other thing that I think is worth reflecting on is not just the financial loss but the enormous loss of potential that this country suffered as a result of these activities and the hampering of the development of New Zealand right until today. We still suffer the consequences of that. We suffer from the asset stripping and the deliberate destruction of the New Zealand rail service to this day. That is an ongoing debate but we have to recognise that finding the resources to make the infrastructural investment needed to get a functioning rail service in this country means we are talking about a lot of money—and we had it. That is the thing; we had it. The rail service was destroyed deliberately in order to line the pockets of these people. 
Of course the other company that Fay and Richwhite have been involved in was Telecom. The legislation we have had to pass in this House after years of going backwards and forwards about it to finally separate Telecom in one guise or another and to start to see the infrastructural investment that will deliver the information technology infrastructure that New Zealanders so desperately need and deserve is again another example of the way that the development of this country has been so seriously hampered by the practices of these people and I can only look at that with disgust. 
Finally my last comment would be to echo Dr Sharples’ congratulations to Mr Peters. Although we disagree with him and New Zealand First on a range of things I think we all have to give a vote of thanks to them for bringing issues such as the wine-box affair to the attention of the country and for persevering in getting this debate on the agenda today. We were not going to have this urgent debate and it has occurred only because Mr Peters persevered and sought leave. I give thanks to the House for not denying leave so that we have been able to have what I think is an important debate. I think that needs to go on the record. Thank you Madam Speaker. 
The debate having concluded the motion lapsed.