Tag Archives: Financial statements

ORFU: Black-tie dinner, theft or fraud?

Dave Goosselink Tweets 17.3.14[screenshot]

• Dave Goosselink — Dunedin face (and voice) for TV3 News & Sports
• Samuel Gilchrist — social media handler for The Highlanders @Highlanders

Retweets by @whatifdunedin and @SearleJamie
• Jamie Searle — Southland Times racing reporter

Correspondence received.
Wednesday, 19 March 2014 10:58 a.m.

From: Bev Butler
To: Steve Tew [NZRU]; Doug Harvie [ORFU]
CC: Murray Kirkness [ODT]; Steve Hepburn [ODT]; Rebecca Fox [ODT]; Ian Telfer [RNZ]
Subject: Black-tie dinner bill to be paid?
Date: Wed, 19 Mar 2014 10:56:35 +1300

Wednesday 19th March 2014

Dear Steve

The following was posted on a local blogsite “What If Dunedin”.

“The conscience of the ORFU is totally absent. The normal procedure for staging an event such as the black-tie dinner is to budget all costs, set the entrance fees to cover those costs and establish a profit level. That is both normal and straightforward – some I’m sure, would say honest, business practice..

The way the ORFU operated was to set the costs, pay out the organiser – who just happened to be the wife of Laurie Mains – ignore the costs and bank the difference. Can anyone tell me that if this scenario happened with anyone else other than the dear old rugby-mad idiots on the Council involved, would this be tolerated? Not on your nelly. Can anyone tell me why this isn’t either theft or fraud?” *

What especially interests me about this post is the question posed as to whether theft or fraud is involved.
It feels like it to me but I’m not sure whether it would hold up in a court of law.
Maybe it could…maybe it couldn’t.
My limited understanding of the Crimes Act is that the hardest part to prove is intent.
In the case of the black-tie dinner, did the ORFU have any intent on paying the bill?
In my opinion, if they did they would have paid it when they received the money from the guests – because obviously it was the intent of the guests for their money to be paid for their evening out.
What do you think, Steve? I’d appreciate your view on this.

I noticed on twitter, media and rugby officials tweeting about this issue.
Strange how the Highlanders’ social media official, Samuel Gilchrist, refers to me as a ‘warmonger’ because I am asking for some honesty from the ORFU. The problem down here is that there is no decent leadership in rugby and hasn’t been for years.
We have Roger Clark as the current CEO of The Highlanders – he was the CEO of Southland Rugby Union at the time when they
they owed over $100,000 in booze. I fear that nothing much has changed.

I had hoped that with the new ORFU board that some leadership would be shown over the black-tie dinner scandal but, to date, that hasn’t happened. Change needs to come from the top so that people like Samuel Gilchrist understands that it is not okay to run off without paying your bills. He doesn’t seem to be able to figure this out for himself. I guess when things have been bad down here for so long those who can’t think for themselves look to the leaders for guidance which is lacking.

That is why I have turned to you, Steve, to finally show some leadership and right this wrong.

I hope I don’t have to continue to prod any deeper.

Yours sincerely
Bev Butler

Previous letter to Steve Tew deleted, read it here

[ends]

*Link to source

Related Posts and Comments:
17.3.14 ORFU: Black-tie dinner on ratepayers
14.3.14 ORFU flush to pay creditors

For more, enter the terms *orfu*, *dinner*, *jeremy curragh*, *bailout*, *martin legge*, *dia*, *pokies*, *jokers*, *ttcf*, or *pokie rorts* in the search box at left.

Posted by Elizabeth Kerr

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ORFU flush to pay creditors

When asked whether the union would consider repaying some creditors who lost money when the deal was agreed to save the union from liquidation, Union chairman Doug Harvie said that would not happen.

### ODT Online Fri, 14 Mar 2014
Profit pleases ORFU
By Steve Hepburn
The Otago Rugby Football Union has recorded a $406,800 profit, just over two years after it faced going out of business because of debts of more than $2 million.
The union now has reserves of more than $500,000, and is predicting a small profit for the coming year. […] In March 2012, the union was a few days away from going out of business, with debts of $2.2 million and creditors failing to come to agreement. But a rescue package was nailed down and the union traded its way out of difficulty, albeit with some concessions from creditors.
Read more

****

Correspondence received.

From: Bev Butler
To: Doug Harvie [ORFU]
CC: Steve Hepburn [ODT]
Subject: ORFU board responsible for paying the black tie dinner bill
Date: Fri, 14 Mar 2014 07:31:59 +1300

Friday 14th March 2014

Dear Doug

In today’s ODT the ORFU have reported a profit of $406,859 for the 2013 financial year and a profit of $134,656 for the 2012 financial year. Part of this so called profit is just pocketing of monies from unpaid bills.

As you are fully aware, the ORFU ran up a DVML bill of $25,352 for their black tie fund raiser at the stadium on 5th August 2011. This was for food, booze, soft drinks and cleaning.

Not only did the ORFU run off without paying this bill but the ORFU paid no venue hire for this brand new venue. Then to top it off the ORFU pocketed $52,000 from this fundraising event into their ‘pot’ which then is reported as profit for the 2012 financial year.

The fact that the ORFU then pressurised the Council to ‘write it off’ does not excuse the ORFU from the moral obligation to pay this bill.

I was quoted in the ODT as saying this was ‘obscene’. It is like booking a large restaurant, gorging yourselves on all their food and drink and hospitality then doing a runner.

It is ‘obscene’ and I expect this bill to be paid in full.

Laurie Mains, and his wife, Anne-Marie, refused to answer questions as to whether Anne-Marie was paid for her services in organising this event. I actually have no problem with her charging for her professional services. What I do have a problem with is that it is standard practice for professional event organisers to ensure all outstanding bills are paid before the ‘surplus’ is paid to the organisation. This did not happen. I don’t know whether Anne-Marie was paid $10,000, $12,000 or even more but whatever the amount the issue is that the other bills should have been paid first.

I fully expect this bill to be paid as the ORFU did actually have sufficient funds to pay this bill as evidenced by the reported profit of $134,656 for the 2012 financial year.

I also remind you that the $350 [sic] guests to this black-tie dinner paid $250 per ticket which would have been paid with the understanding that this would cover the costs. When a function such as this is organised, the ticket price is to cover the costs of the meal, venue hire, cleaning etc. Once the bills are paid, then any surplus is genuine ‘profit’ and the organisation then can legally pocket this ‘profit’.

The fact that the ORFU pocketed this money instead of paying their bill is unacceptable.

It is time the ORFU did the decent thing and pay this bill.

Yours sincerely

Bev Butler

——————————

From: Doug Harvie [ORFU]
To: Bev Butler
CC: Steve Hepburn [ODT]
Subject: RE: ORFU board responsible for paying the black tie dinner bill
Date: Thu, 13 Mar 2014 20:16:32 +0000

You have your facts wrong Bev – ALL creditors of ORFU have been satisfied in full, in one way or another.

I will not be responding to any further correspondence on this matter.

D J Harvie
Partner

Harvie Green Wyatt
(P O Box 5740, Dunedin 9016, New Zealand. Phone +64 3 4775005 or +64 21 2234169. Fax +64 3 4775447

——————————

From: Bev Butler
To: Doug Harvie [ORFU]
CC: Steve Hepburn [ODT]
Subject: RE: ORFU board responsible for paying the black tie dinner bill
Date: Fri, 14 Mar 2014 09:43:19 +1300

Dear Doug

Saying that “ALL creditors have been satisfied in full, in one way or another” is not the same as saying that all creditors have been PAID in full.
I know it is uncomfortable for you to be reminded of this but it still does not excuse the ORFU from doing the decent thing and paying their obscene black-tie dinner given they already had the money but decided to pocket it instead.
How about showing some decency or goodwill towards those that bailed you out of your financial mess now that you are flush with $406,859 profit?

Yours sincerely
Bev Butler

[ends]

For more, enter the terms *orfu*, *dinner*, *jeremy curragh*, *bailout*, *martin legge*, *dia*, *pokies*, *jokers*, *ttcf*, or *pokie rorts* in the search box at left.

Posted by Elizabeth Kerr

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Donations – the quest for clarification

The following correspondence was received from Bev Butler today.

ODT 28/2/07 front page as follows:

Man offers $1 million donation
By Allison Rudd
One person has offered a $1 million donation towards a multipurpose stadium to replace Carisbrook, the chairman of Carisbrook Stadium Trust, Malcolm Farry, says.
He told a public meeting, attended by about 120 people last night, he had received “very significant news today about one huge donation and two others in the wings” which could help meet the $188 million cost.
After the meeting, he said the $1 million donation was from a man whom he could not yet name.
The man had indicated he had associates who were also prepared to talk to the trust about making similar sized donation.
Mr Farry said he was “very excited” about the level of support being offered for the proposal, particularly yesterday’s development.
“Let’s say it made my day.”

Letter to editor (published 22/02/10 Otago Daily Times). The italicised parts were abridged.

Friday 29th January 2010

Dear Editor

It is now nearly three years since it was reported in the ODT (28/2/07) that Malcolm Farry, Chair of Carisbrook Stadium Trust, told a public meeting he had received “very significant news about one huge donation ($1 million) and two others (similar size) in the wings”. Mr Farry said the $1 million donation was from a man whom he could not name yet. Mr Farry said he was “very excited” and it had “made my day”.
Maybe it is now time for Mr Farry to reveal the identities of these alleged donors and let us know if the money has been banked.
Maybe Mr Farry could also give us an update on all donations received for the stadium.

Yours sincerely
Bev Butler

Macolm Farry’s response in today’s ODT:
“As at February 2010, Carisbrook Stadium Trust has secured private-sector funding in excess of $30 million in memberships and sponsorship. The trust does not publish the names of its members, sponors [sic] or donors without their agreement. Last year, we announced the head naming rights sponsor, Forsyth Barr, and we will announce further sponsors in future when they elect to do so.”

National Business Review (3/03/07) by Mark Peart
“Two individuals had pledged about $1 million each to the project since learning of the release of the trust’s feasibility report and “master plan” on February 19.
Several other potential donors had also expressed interest in making major, but unspecified, contributions to the project, should the trust’s preferred option be accepted, Mr Farry said.”

From: bev butler [mailto:bevkiwi@hotmail.com]
Sent: Monday, 22 February 2010 11:19 a.m.
To: mfarry@farrygroup.co.nz
Cc: murray kirkness; david loughrey; chris morris; craig page; michelle sutton; Mike Houlahan (DSC); david williams; robert smith; nbreditor; nbrnewseditor; emma lancaster; katrina bennett; pete hodgson; clare curran; john key; rodney hide; bill english; metiria turei; michael woodhouse; mark hotton; darren burden
Subject: Dunedin Stadium alleged donors: Serious Questions left unanswered (Note change in Mr Farry’s email address)
Importance: High

{private address and phone number deleted -Eds}

Monday 22nd February 2010

Dear Mr Farry

Your response, after three weeks, to my ‘letter to the editor’ (copied below) is completely inadequate.
Firstly, you have avoided responding to the reasonable request for an update of donations. It was revealed in October 2008 (Sunday Star Times) that the donations total was $30. That was the last update we received – upon inquiry.

You have also avoided responding to my query as to whether the several $1 million alleged donations have been banked.
Remember we are not talking about ‘products or sponsors’, but ‘donors’. That is what my query was about and that is what you avoided responding to.

I believe the public have a right to know if the donors actually existed to begin with and if so, do their promised donations, which you so excitedly announced in March 2007 (ODT and NBR), still stand? And if so, why haven’t the donors been happy for their names to be made public now that the stadium is being built? Surely their excitement would be as great as yours and they would proudly want their names out there supporting the project and thereby assist the marketing programme for the stadium.

If these alleged donors have withdrawn their promised donations, why have the public not been informed?

I note in the DCC’s recent media release (19/02/10) the Carisbrook Stadium Charitable Trust’s (CSCT) responsibility is quite clear, namely:
“CSCT will continue to operate as a charitable trust to solicit and receive donations and distribute them in accordance with the purposes of its trust deed.”

Also would you please confirm or deny that these alleged donations were used to help secure the $15 million ‘gift’ from Central Government for the shortfall in private funding?

Yours sincerely
Bev Butler
Former President
Stop The Stadium Inc

From: mfarry@farrygroup.co.nz
To: bevkiwi@hotmail.com
Subject: RE: Dunedin Stadium alleged donors: Serious Questions left unanswered [Note change in Mr Farry’s email address]
Date: Mon, 1 Mar 2010 16:33:44 +1300

Good Afternoon Ms. Butler,

While you have a series of questions we have not, however, conducted the fundraising in the manner that your enquiries would suggest.

There is no difference between donations, sponsorships, sale of product and funds raised. All have a donations component included. Your wish to distinguish between donors, sponsors and purchasers of product indicates a misunderstanding on your part as to the manner of our fundraising

There are several amounts in excess of $1M. As stated in earlier communications, acknowledgements of the individuals and organisations will be made public on the agreement of the parties to so do.

Parties involved have been very supportive of and excited about the project and to have gathered in excess of $30M under the circumstances and in the time involved is quite remarkable. I am sure this has never been equalled in our region and perhaps not even in New Zealand.

It seems unfortunate that you consider it necessary to continue your onslaught against the project when, surely, it would be in the interests of Dunedin and Otago if you put your energies into ensuring the project is a success.

Yours sincerely,

Malcolm Farry
Chair,
CST.

NB The report of $30 being received was in error.
The claims that the Stadium would be paid for from private funds is incorrect and mischievous.

From: bev butler [mailto:bevkiwi@hotmail.com]
Sent: Friday, 5 March 2010 9:56 a.m.
To: malcolm farry
Subject: RE: Dunedin Stadium alleged donors: Serious Questions left unanswered

Friday 5th March 2010

Dear Mr Farry

You have stated in your reply the following:

“There is no difference between donations, sponsorships, sale of product and funds raised. All have a donations component included. Your wish to distinguish between donors, sponsors and purchasers of product indicates a misunderstanding on your part as to the manner of our fundraising.
There are several amounts in excess of $1M.”

I agree with you, Mr Farry, I do not understand the manner of your fundraising as outlined above. Would you please be so kind as to clarify what is the percentage of the donation component which you claim your products and sponsorships contain? A good definition of donation is as follows: A payment is a “donation” if the payer receives no direct benefit in return.

I would also appreciate a direct answer to my original questions as to whether the several amounts of $1m are in fact ‘donations’ and have these ‘donations’ been banked? This shouldn’t be difficult to answer directly. Quite simply: Are the several amounts of $1m actual ‘donations’? Yes or No. Have these donations been banked? Yes or No.

I also note that you have not responded to this question either: “Also would you please confirm or deny that these alleged (ie $1m) donations were used to help secure the $15 million ‘gift’ from Central Government for the shortfall in private funding?”

My continuing interest in the project is purely to keep everything as transparent as possible. Surely you have no objection to this? Surely this could not be perceived as ‘mischievous’ – a word you have used more than once when faced by close questioning by people of the CST/DCC’s affairs.

As for the $30 donation you now say is in error, Mr Hedderwick did confirm to me back in 2008 in an email that the $30 was not a mistake. Mr Hedderwick, Commercial Manager of CST, and Mr Ewan Soper, former CEO of CST, both acknowledged the $30 donation and it was reported in both the Sunday Star Times and then the ODT. The CST have also reported it to the Charities Commission in their Financial Statements.

Yours sincerely
Bev Butler

From: mfarry@farrygroup.co.nz
To: bevkiwi@hotmail.com
Subject: RE: Dunedin Stadium alleged donors: Serious Questions left unanswered
Date: Tue, 16 Mar 2010 18:04:28 +1300

Good Afternoon Ms Butler,

I have provided you with the answers to your questions Any further elaboration would be unproductive.

Monies announced publicly are secured by legal contracts and payment protocols are a part of those agreements.

We have publicly documented the quantum of funds. They are in excess of $30 million at this stage These amounts have been verified. I fail to understand how we can be more transparent than that. Attempts to do that in the past have resulted in misunderstandings such as the thirty dollars you mention. I am sure that nobody could possibly believe that we have only raised this amount

For the record and as I have stated previously there are amounts contracted where the quantum is for $1M and greater

Yours sincerely,

Malcolm Farry

From: bevkiwi@hotmail.com
To: mfarry@farrygroup.co.nz
Subject: RE: Dunedin Stadium alleged donors: Serious Questions left unanswered
Date: Sat, 20 Mar 2010 20:19:54 +1300

Dear Mr Farry

You have not answered my questions about the $1m donations you personally announced, very excitedly, through the media three years ago.
Your persistent avoidance in confirming whether the $1m donations exist is unproductive and can only lead me to one obvious conclusion that the donations do not exist and they probably never did.

Your description of the original $1m ‘donations’ has transformed to ‘amounts’ then to ‘quantums’.
I find this latest description quite apt considering that in Quantum Physics a “quantum is the minimum unit of any physical entity involved in an interaction” (Wikipedia) ie virtually non-existent in the physical world. Note that donations are physical gifts involving the transfer of actual money from one or several sources to another.

Now that you have confirmed that the several $1m donations are not donations, you must realise you are now in a moral quandary.

Your plea below for me to put my “energies into ensuring the project is a success” is curious. You have always asserted that the stadium will be an unqualified success.
I take it that even you now have doubts.

Yours sincerely
Bev Butler

Posted by Elizabeth Kerr

34 Comments

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