Catchpole Brent: Securities Legislation Bill — First Reading 
Catchpole Brent: Securities Legislation Bill — First Reading 
[Volume:622;Page:18043] 
BRENT CATCHPOLE (NZ First) 
: 
 New Zealand First supports the progress of this legislation to the select committee. It is clear that the current laws surrounding insider trading are inadequate. To date there has been not one prosecution in New Zealand for insider trading. This legislation will amend the Securities Act the Securities Markets Act the Takeovers Act and the Takeovers Code. This legislation is desperately needed in the marketplace. The stock exchange operates a market within a regulatory framework designed to maximise transparency fairness effectiveness and competitiveness and to promote confidence among all market participants. It is also there for shareholders. All shareholders should be treated fairly and equitably. Any unfair share-trading practices should be detected and met with effective remedies. It is these remedies that have failed in the past. The market rules should be backed by effective mechanisms for investigation surveillance and enforcement with strong sanctions against deliberate breaches of the rules. 
We have seen huge corporate frauds and means of swapping moneys from one company or one corporation to another and methods of changing the marketplace by insider trading. New Zealand First as most members will know has always stood strongly against corporate crime of any description. We support any moves to clean up our securities market improve people’s confidence in the market and bring to justice those who have not been playing by the rules. 
The Rt Hon Winston Peters refused to quit in his pursuit of the wine-box matter. That clear example shows that New Zealand First is not prepared to allow the kind of corporate fraud that has gone on in the past. 
Pita Paraone 
: What support did this House give him? 
BRENT CATCHPOLE 
: Absolute zero! Members fought long and hard to block every move by which he tried to bring that fraud to the House. It was only on a slip that he was able to table the wine box and expose the fraud that had gone on. 
New Zealand First stands firm on its commitment to fight corporate crime. I would like to quote the Rt Hon Winston Peters who said: “New Zealanders are simply not interested in returning to the failed far-right policies that Don Brash proposes. They know that National has no concern for ordinary New Zealanders but is in the pocket of big business. What has National said about the insider-trading case involving New Zealand Rail?”. 
Simon Power 
: I raise a point of order Mr Speaker. The member knows that it is unacceptable to accuse any member of Parliament or any political party of being under the influence of any party or organisation outside the Chamber. 
The ASSISTANT SPEAKER (Hon Clem Simich) 
: Quite right. Mr Catchpole could you withdraw and apologise. 
BRENT CATCHPOLE 
: I withdraw and apologise. Without sound insider-trading laws and antitrust laws New Zealand is completely out of step with international markets. That is not moot and we have a situation where certain parties in this House have not supported addressing such issues. I dare not say any more on that issue because I will be pulled up again by the member. 
Dail Jones 
: They are very sensitive. 
BRENT CATCHPOLE 
: They are obviously very sensitive about this and with good reason. Aspects of this bill require fine-tuning but it is a step in the right direction. It aims to bring New Zealand’s securities laws into line with those of the rest of the world. We expect many of the flaws in this legislation to be ironed out by the select committee process with the help of submissions from the public and from other parties of interest. But our main issue with this legislation is that New Zealand First wants to see the marketplace cleaned up to provide security and put confidence back in the market. 
A more transparent market is a more attractive market to New Zealand investors and to investors from overseas. The provision in the legislation to prohibit people from creating false trading activities such as buying and selling stock to themselves is to be applauded. Any efforts to stop this are greatly appreciated and welcomed by New Zealand First. Some critics say that the regulations will be expensive to uphold. We are not entirely convinced that the extra $1 million that the Government is prepared to put into this legislation is enough. Let us face it Australia has a budget in excess of $200 million for the Australian Securities and Investments Commission. That is a lot more than New Zealand is prepared to put in. That extra $1 million will bring the total up to only $7 million. So New Zealand First is concerned by the fact that this will not really be sufficient. 
Enforcing insider-trading rules is very difficult and will remain difficult even with this legislation but at least we are getting some mechanisms in place that will make it far more difficult for insider traders and make it easier for them to be caught and exposed. Some in the industry have also said that the legislation amounts to smoke and mirrors and they would prefer that the Government had adopted laws that are better suited to New Zealand rather than mimicking the Australian laws. Unfortunately in Australia as Brian Connell pointed out there have been six prosecutions over the last 10 years. But Brian Connell did not point out that only one person has been convicted and gone to jail. So even with all that extra money it is very difficult and obviously the Australian example is not necessarily the best for New Zealand. We want to see some changes made to this bill and we will be working in the select committee to make sure those changes are brought about. 
The select committee process is likely to iron out these issues and we will certainly be working with the committee to make sure that those problems within the bill are ironed out. We will make sure at all stages that the bill will be what the marketplace requires. Certainly the stock exchange with its high standards would expect the support from the legislation to ensure that people do not take advantage of situations and do not rack up share and securities prices by insider trading by using insider funds to swap from one company to another or by buying their own shares to ensure that their share prices increase. 
New Zealand First wants to make sure that the rest of the community and certainly the business community understands that we will be fighting hard to ensure that there is fair play for everybody that everybody has fair access to all the information and that others do not take advantage of that situation. We have seen that in the past and have fought against it. New Zealand First wants to ensure that this bill makes the marketplace a safer and better place to trade and that trading is on an even playing field so that it is fair for everybody. New Zealand First supports this legislation to the select committee and we look forward to working through it.