Racing body under scrutiny

Gallopsouth has become the latest organisation embroiled in a major pokies investigation, after its Dunedin office was visited by Internal Affairs and Serious Fraud Office staff yesterday.

Last week, both agencies confirmed search warrants were executed as part of an ongoing investigation into the alleged manipulation of pokie grants.

GallopSouth general manager Malcolm Little said he knew nothing of the investigation until he read about it in the Otago Daily Times, and ''then out of the blue I got a phone call''.

He confirmed the organisation was visited by both Internal Affairs and Serious Fraud Office investigators yesterday.

Mr Little said last night the organisation had ''nothing to hide'', and the investigators gave little away about their inquiries.

He believed the investigators were in Invercargill today, and it appeared their inquiries were not limited to southern clubs.

''But where it all ends up, I wouldn't like to say.''

GallopSouth applied for fewer pokie grants than in previous years, as there were fewer ''racing-friendly trusts around'', he said.

One of the country's largest pokie grant funders, the New Zealand Community Trust, was raided last week and computers seized.

The two trusts confirmed as being part of the joint Internal Affairs and Serious Fraud Office investigation; New Zealand Community Trust and the Bluegrass Trust, have been notable funders of southern racing interests.

Between April 2010 and March 2012, Blenheim-based Bluegrass Trust granted almost half ($2.167 million) of its nationwide grants ($4.5 million) to Southern racing clubs, despite having no pokie venues in Otago or Southland.

Yesterday, Bluegrass Trust chairman Peter Gurr said the trust would issue a statement later this week.

''We just have some ongoing issues to sort out.''

Last year, the trust's licence was suspended, with charges relating to the trust supplying false or misleading information about three trotting club loans, Internal Affairs said.

Internal Affairs also said it found a key person to be unsuitable because of his previous poor compliance with the Gambling Act; the trust had breached the Gambling Act by knowingly receiving funds with conditions attached from potential grant recipients.

A person connected with the Bluegrass Trust is expected to appear in the Blenheim District Court today charged with making a false statement with intent to deceive, the Marlborough Express has reported. The charge was laid last year, and the man has said he would vigorously defend himself.

hamish.mcneilly@odt.co.nz