The saga of the sale of the 16 Crafar family dairy farms took another twist today with the Serious Fraud Office (SFO) launching an investigation into transactions between companies related to the Chinese-backed buyer.
The SFO is promising to investigate "in all reasonable haste" due to commercial and "other sensitivities".
The farms in the Waikato, King Country, Bay of Plenty, Wanganui, Taranaki and Rangitikei were valued at $206.9 million before they were taken over by receiver KordaMentha, who in May said it signed a sale agreement with UBNZ Funds Management, conditional on Overseas Investment Office (OIO) consent.
The SFO said that acting on information received from the OIO, it had started an investigation into transactions between Natural Dairy (NZ) Holdings Ltd (Natural Dairy) and UBNZ Trustee Ltd; UBNZ Assets Holdings Ltd; UBNZ Funds Management Ltd.
"We have received information from the OIO, together with materials received from other sources, to be satisfied that a 'Part I Investigation' under the SFO Act is warranted; that is to say that an investigation into transactions involving Natural Dairy and the UBNZ group may disclose serious or complex fraud," said SFO chief executive Adam Feeley.
The transactions are the proposed purchase and sale of the Crafar farms.
"After the initial investigation and report, we will decide whether there are reasonable grounds to believe an offence involving serious and complex fraud may have been committed and, if warranted, undertake a further, in-depth investigation under the powers of Part II of the SFO Act," Mr Feeley said.
Separately, the OIO is continuing to look at whether UBNZ Funds Management breached the Overseas Investment Act by not obtaining required consents for purchase of two farms on February 11 at Norsewood in southern Hawke's Bay and Waitotara in south Taranaki, and two others four days later in the Manawatu. Once purchased the farms were transferred to UBNZ Assets Holdings.
UBNZ is 80 percent owned by the New Zealand-based UBNZ Trustee Ltd and 20 percent by Hong Kong-based Natural Dairy (NZ) Holdings. Businesswoman May Wang - who has been fronting the deal - has previously said because she is New Zealand citizen and Natural Dairy only has a 20 percent stake - less than the 25 percent trigger point for an OIO application - the purchase completely conformed with the Act.
It is an offence for an overseas person or an associate of an overseas person to buy sensitive land without consent.
The sale of the Crafar farms has been caught up in a debate about foreign ownership of farmland and the suitability of Ms Wang, who has been associated with failed investments in this country. State-owned Landcorp submitted a tender for the farms which was not accepted.
Agriculture Minister David Carter got into trouble after saying at a National Party regional conference the Crafar farm sale was unlikely to go through the OIO.
The OIO said it will not make a recommendation to ministers on the applications by Natural Dairy (NZ) Holdings and UBNZ Assets Holdings to purchase the Crafar Farms Crafar farms while until the SFO investigation is concluded.
