Patrick O’Brien, the former Harness Racing NZ chairman, appeared by video-link in a the Wellington High Court on his 83rd birthday on Monday. He is accused, with his son, Mike O’Brien, and two others, of multiple counts of obtaining gambling licenses and funds via deception.
The doyen of New Zealand’s racing industry, now frail and infirm, denies the charges against him, as do the other three.
The prosecution asserts that Mike O’Brien, 58, described in court as a racing lobbyist engaged in helping racing venues to obtain grants, was denied a gambling license in 2005 for reasons of conflict of interest. Subsequently, it’s alleged, he encouraged others to establish companies on his behalf in order to obtain gambling licenses.
Also on trial is Paul Max, 60, and a former Department of Internal Affairs employee who cannot be named for legal reasons. The Department of Internal Affairs is responsible in New Zealand for issuing licenses under the Gambling Act.
Grants For Cash
It’s alleged that Mike O’Brien controlled millions in pokie profits for his own purposes via a company called Bluegrass Holdings.
He also allegedly ran a scheme where he received kickbacks from racing clubs in return for grants.
Prosecutor Grant Burston said Michael O’Brien exercised “significant influence” over Bluegrass Holdings, a fact that the others were aware of, and which they concealed from Internal Affairs Inspectors.
Charitable trusts, such as Bluegrass claimed to be, are permitted to distribute the proceeds of their gambling operations to underfunded racing venues. But, according to Burston, Mike O’Brien ensured those proceeds went to the clubs that gave him the best kickbacks.
Racing Ain’t What it Used To Be
In an interview with the New Zealand Herald, apparently conducted two years ago when the fraud investigation was launched, but first published only last week, Mike’s father Patrick claimed he set up Bluegrass for the benefit of clubs after government funding dried up.
“The taxes the government take out of it don’t leave enough for the clubs to exist on,” he said. “When I was growing up you went to the pictures on your push bike and on Saturday there was nothing else to do unless you played football.
“Now everyone goes to the beach or goes to the hills. They’ve got casinos to go to and pokie machines to go to. The pubs are open to midnight. A day at the races is no longer the attraction it used to be. They’re not betting now what they were betting 30 years ago.
“The take for the clubs, particularly those with poor dates and country venues … they’re not getting enough to exist.“
The prosecution intends to call 46 witness, while the trial is expected to last six weeks.
By Kylie Taylor