Increasing fraud puts New Zealand at risk

The increasing instances of fraud and other types of economic crime not only tarnish New Zealand’s perceived image as the least corrupt country in the world but also negates the ‘Corruption Perception Index (CPI) of Transparency International (TI), a global corporate chief has said.

Vino Ramayah, Executive Chairman of Medtech Global Limited (and a number of other companies) said that the TI annual Survey did not reveal the hard truth.

“About 50% of public and private companies in New Zealand suffered economic crime according to a PricewaterhouseCoopers Survey in 2011, up from about 42% in 2009. This was significantly higher than the global average of 34%. New Zealand had the fourth worst ranking in fraud out of 78 participating countries,” he said.

Mr Ramayah was speaking at the third annual Indian Newslink Sir Anand Satyanand Lecture at Stamford Plaza Hotel on Monday, July 29, 2013.

The theme of his address was, ‘Transparency: Myth or Reality?’

Rising graft

He said that only 4% of New Zealand respondents admitted to paying a bribe.

“This was two times higher than Australia and four times higher than Britain,” he said.

He said that more than 50 Finance Companies had gone bust since 2005, leaving billions of dollars owed to retail investors and cited examples of Bridgecorp (owing 14,500 investors over $450 million), Capital+Merchant Finance (owing 7500 investors $167 million) and South Canterbury Finance ($1.7 billion).

Mr Ramayah said that a number of factors encouraged transparency, the foremost among which were strong democratic institutions and free media.

“An open political process, Rule of law and legislation which enable freedom of information, enforcement and digitisation are also important,” he said.

Internet denudes

According to him, the Internet is the largest ungoverned paradigm that humanity has ever known.

“We are all naked before the internet. This nakedness will transform our previous concept of transparency, with availability and velocity of information transforming the way in which we access information and increase transparency,” he said.

Sir Anand Satyanand

In his address, Sir Anand said that TI, in its December 2012 Survey (from Germany), had rated New Zealand Number 1 equal and with a score of 90 out of 100.

“In January and February this year however, a poll within New Zealand, conducted by Colmar Brunton and included in an international study a few weeks ago, had stated that more than half of the world’s people believe that global corruption has worsened over the past two years and found a lack of trust in the police, courts and political parties. The New Zealand component of the Survey involved 1000 New Zealanders. About 3% of the respondents said that they had paid a bribe,” he said.

Prominent Public Law and Employment Law Specialist Mai Chen was the Master of Ceremonies. About 200 corporate leaders, lawmakers, law enforcers and others attended this Year’s Lecture, of which ANZ Bank and Radio Tarana were the Title Sponsors.

The picture here shows (from left) Lady Susan Satyanand, Sir Anand Satynanand, Ravin Lal, Mai Chen, Dr Russel Norman, Vino Ramayah, Veera Ramayah, Reena Ramayah, Robert Khan, Mark Hiddleston, Winston Peters, Ramesh Subramaniam and Penny Hulse (Picture by Narendra Bedekar)

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