A Rugby Southland employee has been discharged without conviction after admitting Gambling Act charges, brought when Lion Foundation grants to the union increased "markedly" on the foundation taking over gaming machines at an Invercargill tavern.
The man was charged with breaching the Act by being both a provider and applicant for funding when he appeared in Invercargill District Court yesterday.
He admitted the charges, but Judge John MacDonald granted him final name suppression on discharging him without conviction.
The case was brought by the Department of Internal Affairs, which said the man was a "key person" as he took an active part in the financial management of the tavern, owned by local rugby interests.
That prevented his involvement in certain activities, the department said.
Part of the man's salary at Rugby Southland was funded by grants from the Lion Foundation.
In mid 2007, Lion Foundation took over the operation of gaming machines at the tavern and grants from Lion to the union increased "markedly".
His lawyer Bill Dawkins said the Lion Foundation, which had intricate knowledge of the Gambling Act, failed to address the situation, the Southland Times reported.
The Otago Daily Times reported that a confidential 2007 Pricewaterhouse Coopers report revealed the union was aware of the arrangement.
"Rugby Southland has advised that the arrangement is legally robust," the report said.
Rugby Southland chairman Owen Shaw did not return calls to the paper.
Internal Affairs gambling compliance director Mike Hill, in a statement, said the Act ensured that the grants process was transparent and fair. It was aimed at discouraging and preventing persons involved with a venue influencing the grant distribution process.
"Community groups should expect to receive fair and equal consideration when they apply for funding," he said.
"Owning or controlling a pub with gaming machines does not entitle any group to preferential treatment."
The department failed to get a conviction in yesterday's case, but is pursuing the Lion Foundation on similar charges, and a case against the foundation will be heard in North Shore District Court in February.
