Labour says Argentinian court case raises questions for OIO
The Overseas Investment Office is investigating claims the foreign owners of the Onetai station in Taranaki were held responsible for polluting a river in Argentina in 2011.
The Onetai station was bought for $6 million through a trust, Coel & Muir, which was set up by secretive Panamanian law firm Mossack Fonseca.
Labour land information spokesman David Cunliffe said Argentinian businessmen Rafael and Federico Grozovsky, who the Overseas Investment Office (OIO) identified as the owners of the trust, "were found 'criminally responsible'" for polluting the Lujan river in Argentina.
That followed the release of toxic chemicals from a tannery company they owned, Magromer.
The OIO said it was looking into the matters which it said raised "serious issues".
An original ruling convicting Magromer and ordering the prosecution and seizure of assets worth up to 100,000 pesos (NZ$10,000) from each of the Grozovsky brothers was upheld on appeal, the documents obtained by Labour suggest.
Cunliffe said the incident raised the question of how the businessmen were able to meet a character test required by the OIO prior to it approving the Onetai station purchase.
Finance Minister Bill English and then Land Information Minister Maurice Williamson approved the sale of the farm in 2014 on the recommendation of the OIO.
It advised them Coel & Muir was ultimately owned by the Grozovsky brothers, who ran a 400-person tanning business they inherited from their grandfather.
The Onetai station was in a "run down" state with an estimated 2000 feral goats roaming the property and surrounding bush, the OIO said.
It said the Grozovsky brothers planned to tackle the goat and other pest problems and breed polo ponies at the farm for export around the world.
The OIO appears to have been uncertain about Coel & Muir's ownership after receiving its purchase application for the Onetai station from law firm Kensington Swan.
A Panamanian public deed, translated from Spanish, identified three Uruguayan residents – Marcelo Saul Rivero Sosa, Nestor Gustavo Cardozo Garcia and Gustavo Daniel Chaves Mantaras – as Coel & Muir's "first directors and officers".
Kensington Swan told the OIO that Coel & Muir was a "blind trust" that was controlled by the Grozovsky brothers through a power of attorney, according to an OIO memo released to Stuff after an appeal to the Ombudsman.
OIO group manager Annelies McClure said it was advised on November 20, 2013 by Coel & Muir's legal advisers that the Grozovsky brothers were the 100 per cent shareholders of Coel & Muir and that information was verified by statutory declarations signed by the brothers.