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Land sale under investigation

NZ NewswireNZ Newswire 2/05/2016

The Overseas Investment Office says it is investigating "serious issues" that have been raised about the sale of a Taranaki station to a foreign company.

Labour MP David Cunliffe last week revealed the owners, Rafael and Federico Grozovsky, were convicted in Argentina in 2012 because a tannery they owned leaked chemicals into a river.

The OIO approved the sale of the 1320ha Onetai Station in 2013 and in 2014 it was bought by the Grozovsky brothers, trading as a company called Ceol and Muir.

Buyers of significant amounts of farmland have to pass good character tests, and Mr Cunliffe wants to know how that could have happened when the brothers had a prior conviction.

In a statement released on Monday, Land Information New Zealand said the OIO was "looking into matters relating to the consent application by Ceol and Muir that were reported in the media last week."

It said the media reports raised "serious issues which the OIO is continuing to investigate".

The purchase first came to light because Ceol and Muir was a client company of Mossack Fonesca, the Panama-based law firm that specialises in setting up foreign trusts.

A whistleblower leaked millions of the companies documents, known as the Panama Papers, which sparked an international uproar over foreign trusts.

They are legal but can be used to hide money from tax authorities or launder money.

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