Serious Fraud Office Amendment Bill

on behalf of the Minister of Justice: I move, That the Serious Fraud Office Amendment Bill be now read a second time.

The bill makes targeted changes to the Serious Fraud Office (SFO) Act 1990 so that the Serious Fraud Office can operate more effectively in the digital age. Since the Act was passed 36 years ago, technology has dramatically changed; information is stored in the cloud and remote digital servers rather than on paper in office cabinets. While other legislation has been updated, the SFO Act has not kept pace. The bill updates the SFO’s search warrant framework so that it is more aligned with the Search and Surveillance Act 2012. These targeted amendments will ensure the SFO can move effectively, obtain evidence of fraud that is stored digitally and remotely on online servers, by specifying that the SFO can search a thing as well as a place.

The bill also makes the application process for a warrant more efficient by enabling the SFO director to apply for a search warrant orally in certain circumstances, and then an application for a search warrant can be considered by an issuing officer, court registrars, and authorised justices of the peace rather than only a judge. Again, this change mirrors the requirements in the Search and Surveillance Act.

The bill will also enable the SFO to access necessary services like electricity when conducting a search, and to exclude someone from a search site if there are reasonable grounds to suspect the person might compromise a search. The bill also updates the legal tests in the SFO Act for the courts to determine the admissibility of evidence that may not have been obtained according to the rules. The bill changes the tests to reflect the more recent and widely applied test from the Evidence Act 2006. This provides for a more balanced test, allowing the court to consider a range of factors when determining whether evidence can be included in a prosecution.

I’d like to acknowledge and thank the Justice Committee for its thoughtful consideration of this bill. The committee made several recommendations to strengthen the safeguards in the bill by aligning some of the requirements with provisions in the Search and Surveillance Act. These relate to remote access searches, oral warrants, and the return and disposal of things and documents. The committee also recommended changes to better accommodate digital and remote searches. These are often very time-consuming and require more than one entry into a device. The committee recommended allowing an issuing officer to provide for extended timeframes for executing search warrants, and multiple entries under a warrant, if appropriate. This is in line with the Search and Surveillance Act. Finally, the committee recommended a minor change to the wording around the use of force to update and modernise the language in the bill.

Without legislative change, there is a serious risk the SFO may not be able to hold criminals to account and prevent further victims of the most serious and complex forms of fraud. Ultimately, this bill provides the SFO with the modern investigative tools it needs to protect New Zealand from serious fraud and corruption and the harm it causes. Behind the figures of the millions of dollars stolen through this insidious crime are everyday New Zealanders—workers and retirees—who have lost their savings, and businesses that have suffered significant financial losses.

The Government believes it must act to ensure the Serious Fraud Office (SFO) has the tools it needs to both hold serious fraudsters to account and to protect New Zealanders from them. I commend this bill to the House.

ASSISTANT SPEAKER (Maureen Pugh): The question is that the motion be agreed to.

Thank you, Madam Speaker. I wish to draw the House’s attention to the date of the original Act here—it’s the Serious Fraud Office Act 1990. I would invite all members of the House to cast their minds back to 1990, except I know that’s impossible for Mr Rutherford over there. It was the year I got married, so 36 years ago, and the world was a different place. I think I sent my first email in 1993 and the World Wide Web—the internet—was only becoming a thing around about 1997, 1998, 1999, that sort of date.

The world has changed significantly since the Serious Fraud Office Act was first put into place, hence the need for this bill to update how the Serious Fraud Office may operate. It’s giving the Serious Fraud Office permissions to operate in particular ways, particularly around digital searches. That’s a very necessary thing, and the Labour Party continues to support this bill. As someone who wasn’t on the select committee, I do note that the bill went through the select committee unanimously. That doesn’t always happen, but this does seem to be a bill that, so far, most people in this House support.

I do want to just raise one issue, though—well, not so much an issue; it’s an injunction to all the parties in this House in terms of the sorts of searches that are being enabled by this new legislation; the new powers that the Serious Fraud Office has. It is incumbent on this House and Opposition parties, in particular, to make sure that the Parliament is held to account—so, speaking to my National Party colleagues over there: it will be your role after the election this year of holding this House to account.

But it is actually all of our jobs in this House to keep an eye on the various enforcement agencies that this nation has. We do need to monitor what the police are doing, what the Serious Fraud Office is doing, what any of the regulatory agencies are doing. That is all of our jobs, and it’s a very important one. By and large, those agencies operate very, very well indeed, and the people in them are committed to doing the best they can, but sometimes things do go wrong.

Given these new powers, we will need to keep an eye on what the Serious Fraud Office is doing and as we pass this bill through the House, I invited members of this House to take up that role seriously. We commend this bill to the House.

Thank you, Mr Speaker. I rise on behalf of the Green Party as the Green Party’s justice spokesperson to also support the Serious Fraud Office Amendment Bill. Yes, I do think that considering the number of bills that are going through the Justice Committee—of which there are many, as many members here who are on the Justice Committee could attest—this was one of the bills that probably had more collegial views and perspectives when it comes to the Serious Fraud Office and the updates that we’re seeing in this particular bill.

Just to capture some of the things that this bill does, first of all, this bill is an update in response to, I believe, the Court of Appeal case of Crown v Pikia. Again, one of the things that we mentioned in the first reading, and I believe this is something that both myself as well as the Hon Dr Duncan Webb have spoken to, is that while we do support this bill, one of the issues we’re seeing is the Government—and not just simply this Government; Governments in general play this top trump of trying to catch up to the judiciary when something was ruled in the judiciary and, suddenly, a new bill is introduced in the House to try and plug a particular gap.

One of the questions that was proposed during the first reading on this bill was: what could Government or Parliament do in general that takes a more proactive approach when it comes to addressing something like this, which is an update in nature but doesn’t necessarily need to respond or be reactive all the time to something that the judiciary has ruled on? I think this is something that, for example, we’re seeing in the Statutes Bill, we’re seeing regulatory systems bills being introduced in this House—they are non-contentious in nature. They provide the necessary housekeeping updates that we’re seeing within legislation. How are we able to potentially use some of those to be able to update, in a collegial manner, some of the Acts like this to prevent some of the things that we’re seeing within—that, potentially, is proactive as opposed to reactive?

The other aspect of that is also when we are looking at a bill such as this. Of course, when we’re looking at some of the bills in response to rulings by a judge, I think it will be remiss of me to also mention the Climate Change (Tort Liability) Amendment Bill, which is one of the few instances where the Parliament has actively intervened in an active court case as opposed to what we’re seeing here in the Serious Fraud Office Amendment Bill, which is in response to something that’s already ruled. I think that is something that, as a Parliament, we do need to consider seriously in terms of the separation of powers, the three powers, and also the principle of comity. I think, in this case, when we look at the Serious Fraud Office Amendment Bill, one could argue that there was the right balance being struck when this bill was introduced that allowed the court to take its natural path to reach a decision before the Government intervened.

On to the specifics of this bill—again, the Minister has mentioned already some of the updates. The most important part is to more effectively obtain digital devices and evidence stored in the cloud. This is something that we discussed quite a bit during the select committee stage. Most importantly when it comes to the idea of when we are looking at search warrants or search and surveillance of physical objects, they are often considered in situ. They are at a physical location here, you are able to tangibly take it, so there are a couple of things that needed to be teased out by the select committee.

First of all, when you are looking at something that is accessed by the cloud, how many times is SFO able to access it? Is it once; is it multiple times? What is required to be determined as part of the search warrant in those instances?

Secondly, while it is in the cloud, when we’re looking at aspects of privacy—and we did have conversations around privacy—from a privacy perspective and from a cloud data storage perspective, what is the jurisdiction when we’re looking at the cloud being in an offshore jurisdiction?

Todd Stephenson: It’s the data centre.

Dr LAWRENCE XU-NAN: The data centre—well, yes. I’m so glad that Todd Stephenson has mentioned the word “data centre”, because from the perspective of data centres, that is important when we’re looking at the concept of data sovereignty in Aotearoa New Zealand. However, “data centre” is not the same thing as “AI data centre”, in which case an AI data centre, in this particular case, does not provide the kind of data sovereignty, or even what we’re seeing here in this bill, but I think the distinction needs to be clearly made.

The other challenge that we had, and that was discussed during the select committee stage, is—you know, I mentioned whether the cloud is in an offshore jurisdiction. But what happens if what needs to be searched, the item itself—i.e. let’s say a computer is offshore; the physical object itself is offshore storage and SFO needs to access it remotely here in Aotearoa New Zealand to a cloud, or to remote access a physical object in an offshore jurisdiction to a cloud in response to, let’s say, a serious fraud case.

These are some of the things that have been discussed, and I think these are some of the things that require further engagement with the Minister during the upcoming committee of the whole House to get better clarity, and I’m anticipating that Ministers are able to prepare for some of the questions I will be asking. These are some of the things that need further discussion, because, again, some of these questions did not receive a fulsome response at the select committee.

One of the other things that is also updated in this particular bill is, I guess, in some ways the consistency of language. Again, this is something that requires further conversation and engagement with the Minister during the committee stage. This is the changes to the language around “reasonable force”. In the original drafting of this bill, it talks about using reasonable force in respect of any property for the purpose of carrying out the search and any lawful seizure. However, in that particular case, reasonable force did not specify reasonable force when it comes to entry to a particular property.

As part of the updates in this bill—and this is where we need to potentially get some examples during the committee stage—is what is the extent of that particular entry when we’re looking at the use of reasonable force. Previously, when looking at this particular drafting, the assumption was that when you’re using reasonable force for search and seizure, you are already permitted to enter a particular property. But with the update, which, understandably, aligns with the current section 12C(2)(b) of the Search and Surveillance Act, it does align with that in terms of the use of reasonable force for entry as well. However, this, again, is something that I think we need to have a further conversation on in the role of the Serious Fraud Office (SFO).

Finally, one of the other main questions that did come up when it comes to this particular bill is—actually there are two additional things—when the SFO is present and is able to conduct some of these, are they, under the current understanding of the Search and Surveillance Act, allowed to have other people there? In which case, while there could be warrant searches by the SFO, who else is able to be brought alongside them—either the police or other enforcement officers? A lot of bills that have been introduced have enforcement officer capabilities—the Planning Bill, the Natural Environment Bill, and in the current drafting of the New Zealand – India free-trade agreement bill as well. So we are seeing some of that. Again, this is another question that needs to be teased out during the committee stage. So, with that, the Green Party does support this bill, and we’re looking forward engaging with the Minister further in the committee stage.

It gives me pleasure to rise on behalf of ACT to speak on the Serious Fraud Office Amendment Bill. I was lucky enough to be part of the Justice Committee, which considered this bill. I want to thank the 19 submitters who make submissions in relation to the bill. A number of changes obviously came out as a result of those submissions and the select committee’s consideration.

In my short litigation career, I was defence counsel in a Serious Fraud Office (SFO) case. In that time, all the documents were actually paper-based, and I think we’ve come a long way, as the updates in this bill show. Records are now more electronically stored and so this bill does update things to make sure that the SFO has the power for the modern world. It also—and I think this is really important—more closely aligns the powers of the SFO with the existing Search and Surveillance Act. I think having enforcement agencies with the same powers is very important.

So, yes, as has already been said, this bill has been unanimously supported out of the select committee and I commend it to the House.

I rise on behalf of New Zealand First to speak on the Serious Fraud Office Amendment Bill in the second reading. It is incredibly important—and we have said it previously in this House, regarding our ability to respond to serious and organised crime—that we have to be able to move faster and more effectively to combat the enemy that is common to so many of us. This is about our ability to move at the speed of money, which is what the offenders that we are dealing with are doing. We have until recently been constrained at the pace of law, and giving the Serious Fraud Office more modernised legislation that gives us the powers to respond to the very highly technical way in which these offenders operate is critically important to our effectiveness and, therefore, New Zealand First commends the bill to the House.

Thank you, Mr Speaker. I rise to support the Serious Fraud Office Amendment Bill. I was not on the Justice Committee to hear all the details. I am therefore probably one who is highly amused by the constant reference to “thing”. I love the Old English derivation—thing. It used to be “devices”, it might be “data”, it might be “equipment “, but, no, we are going for “thing”. I do understand why but, just on a lighter note while we’re working our way through the wee hours, I thought I would share that amusement.

Really, this bill exists because the courts told us that our fraud laws were broken. The Court of Appeal found that the Serious Fraud Office is noted in the search warrant regime as unreasonable and a significant overreach against people’s rights, so this bill updates the 36-year-old Act. There are an awful lot of changes in data, in internet access, in just the speed of fraud in those nearly four decades.

I want to acknowledge the submission from the New Zealand Law Society. They support modernising the Act but very carefully pushed for more care—full oral warrant safeguards, tighter use-of-force wording, and clarity that none of these powers authorised force against a person. Even when the target is white-collar offending, the legal profession’s instinct is sound about protecting rights.

Fraud costs this country billions every year, and the trend should worry every member of this House. In 2003, a long time ago, the Serious Fraud Office put expected fraud losses at about $200 million. By 2023, that figure was roughly $5 billion, a 25-fold increase. But it’s not abstract, that $5 billion. Behind that number, there are real families who have lost retirement savings, small business gutted by fake invoices, friends of mine who have been scammed out of their small retirement savings, and charities that have been quietly hollowed out, sometimes over years.

New Zealand used to sit at fourth equal in the world on Transparency International’s Corruption Perceptions Index. We’ve slipped to fourth. That may be as much about political donations as corporate fraud, of course, and the two are not unrelated. The Serious Fraud Office alleged—alleged—that a $100,000 donation in 2017 and a similar donation in 2018 to National were funnelled through sham donors—multiple individuals who hid the identity of the true donor. The Serious Fraud Office also alleged that between 2015 and 2020 nearly three-quarters of a million dollars in political donations was redirected into a New Zealand First Foundation bank account rather than the official party account. No politicians were charged. The Court of Appeal dismissed all charges. However, the Court of Appeal explicitly noted in its judgment that these cases exposed major structural weaknesses and legal loopholes in New Zealand’s Electoral Act regarding how political money is tracked. If we want real democracy and we want openness and transparency, then we need to not just fix the Serious Fraud Office; we need to fix the New Zealand Electoral Act too. Talking tough on crime is never about white-collar crime.

I might not have been here in 1990 when the Serious Fraud Office Act was first empowered and brought into legislation, but I certainly was a member of the Justice Committee that scrutinised this bill, and there was unanimous support for the recommended amendments and changes we made, so let’s get it done. I commend it to the House.

It’s a pleasure to rise and take a call on the Serious Fraud Office Amendment Bill. Labour supports this bill, because the Serious Fraud Office needs investigative tools that reflect how serious and complex fraud is actually carried out today. The Serious Fraud Office Act dates back to 1990. Tom Rutherford—he might not have been here. I was at primary school. There were people getting married—

Tom Rutherford: As a teacher.

DAN ROSEWARNE: Ha, ha! Absolutely.

Back then, an investigation was much more likely to involve paper records, filing cabinets, bank statements, documents, and fax machines, all locked away in a cabinet somewhere in the office or at home. But that’s not the world investigators are dealing with now. The evidence may be on a cellphone; on an encrypted device; in a cloud account, even; or spread across multiple computer systems in several different places, and it sits behind multiple passwords and encryption keys. It may be copied, moved, deleted, or hidden away quickly.

This bill responds to the reality by making it easier for the Serious Fraud Office to obtain digital devices or evidence that’s actually stored in a cloud set-up, modernising search warrant applications, expanding the powers available when warrants are executed, and aligning the treatment of unlawfully obtained evidence with the Evidence Act. These are necessary changes that meet the modern environment.

We should not expect an agency tasked with investigating some of the most serious and complex fraud in New Zealand to operate with legislation designed before cloud computing, smart phones, online banking, or even cryptocurrency applications these days. There’s been an enormous growth in electronically stored information, so the law needs to keep up. Keeping up with that technology does not simply mean giving investigators broader powers and leaving it there; it also means making sure those powers are clear, properly targeted, and matched with the safeguards that work in the same digital environment. It’s important that we get that balance right.

This bill starts by updating the language of the principal Act. Just reading through the bill, clause 4 introduces the definitions of “access” or “access information”, “computer system”, “remote access search”—and a “thing” was already mentioned in an earlier contribution. The definition of a “thing” will include an intangible thing such as an email address or access information for an internet data storage facility. A “remote access search” is defined as a search of something “such as an internet data storage facility that does not have a physical address that a person can enter and search”—as defined within the bill.

That may sound like a fairly dry interpretation clause, but it does a lot of the heavy lifting within this bill, and it takes the law beyond the traditional idea that a search is always a physical activity. An investigator no longer necessarily arrives at a building or walks through a door like they might have in 1990 and opens a draw. A search might instead involve accessing a cloud account or another digital resource that cannot sensibly be pinned to one physical address. It’s a practical recognition of the way information is stored today, but it also raises an important jurisdiction issue. A person being investigated might be in New Zealand, and the account might be administered in New Zealand, for that matter, but the cloud provider might be overseas. The underlying information might be held in a data centre in Australia, even, or Singapore, or the United States, or actually distributed across several jurisdictions. Although the investigation begins here, it might not be obvious where the search legally takes place. That is something that I intend to return to during the committee of the whole House. I want to hear clearly how the Government expects these powers to operate where information is stored offshore, and where the practical and legal limits sit when a New Zealand warrant reaches an overseas cloud environment.

Clause 6 replaces section 10 of the Serious Fraud Office Act and sets out the process for applying for a search warrant. The director must set out the grounds for the application, describe the place or other thing to be searched, describe evidential material that is believed to be there, and state the period for which the warrant is sought. That actually came up in the select committee on multiple occasions, about how they were going to flesh that out.

The director must also disclose known applications made within the previous three months involving the same place or thing, along with the outcome of those applications. That is important. The broader and more technically complex a search power becomes, the more important it is that the warrant application defines what investigators are looking for and where they actually expect to find it. For a physical warrant, that may be relatively straightforward. The application might identify a particular office or a warehouse, computer, or filing cabinet. But it becomes more difficult within a cloud-based system. A single account may hold huge volumes of information assembled over a long period. Personal material may sit alongside business information, and relevant evidence may sit alongside information that has nothing whatsoever to do with the actual investigation. The challenge then is to ensure that the description of the thing being searched is specific enough to place a meaningful boundary, a central boundary, around that search.

Clause 6 also allows an issuing officer to accept an oral application, including by telephone or personal appearance, where the delay caused by requiring a written application would compromise the effectiveness of the search. The same information required for a written application must still be supplied, and the issuing officer must record the grounds as soon as practicable. There’s a sound operational reason for that provision: because digital evidence can actually move quite quickly, as we all know, and a delay may provide an opportunity for information to be deleted, altered, transferred, or made inaccessible. At the same time, an oral application should not become a shortcut around that proper scrutiny. The select committee has strengthened the process by requiring all of the information that would be required in writing to still be given to the issuing officer and by requiring the grounds for it to be recorded. So the bill also deals with the practical difficulty of searching large quantities of digital material.

I’ll also point out that an issuing officer may also authorise a warrant to be executed more than once where that is required for the purpose of the search. Warrants will generally run for no more than 14 days, but the issuing officer may specify a period for up to 30 days where a longer period is necessary for that execution.

The warrant must state the number of times—just reading through the bill here—it may be executed, if multiple executions are authorised. The committee’s commentary at the start of the bill explains the practical problem: law enforcement agencies may be dealing with many devices and large volumes of cloud information, and the time needed to download and copy the data and do backups must be completed. That all takes time, and applications that require further procedures before the access is needed—again, the more we go through this bill, the case for that modernisation is clear. The bill also improves the powers available for when a warrant is executed, and it allows for the access to computer systems and data storage devices, and then also other types of intangible material. It’s a good bill, and I commend it to the House.

Thank you, Mr Speaker. I rise in support of this bill as well. It’s a good bill, a sign of the times—where we’re going and what we need to do.

In select committee, we received 19 submissions. I’m grateful to all of those that did submit, including Mr Max Marshall, who submits on a lot of our justice bills and always reminds us that justice delayed is justice denied. I commend this bill to the House.

Thank you, Mr Speaker. I wasn’t on the select committee that considered this bill—the Justice Committee—but having heard from some colleagues and their lengthy contributions—much appreciated—I feel like I have learnt somewhat a little bit more about this bill.

Labour will be supporting this bill, which is obviously in contrast to what we have been contemplating for the vast majority of this period of urgency, where most of our time has been spent here talking about both the Planning Bill and the Natural Environment Bill, which, of course, was the opposite of supporting—we’re very much opposed to those bills. At this very late stage, here we are with a bill in front of us that sounds very sensible. As my colleague the Hon Dr—

Shanan Halbert: Finally, some sense!

Dr TRACEY McLELLAN: I was going to call her something else, but the Hon Deb Russell had said that 1990 was the last time that this bill was updated, and that sort of sent me down memory lane a little bit when I was thinking about what the number one song in 1990 was and what I was doing in 1990—hearing stories of other people being not born or being at primary school, and thinking to myself, “Hmm, I’m sure that I was somewhere doing something fabulous as a 20-year-old me.”

Anyhow, this bill we will be supporting. It’s quite interesting insofar as its background. It is largely, as a response of the Court of Appeal’s criticism of R v Pikia in 2024, where the Serious Fraud Office (SFO) filed seven charges against Roger Pikia, including obtaining by deception and corruptly accepting a gift as an agent. Whilst there’s quite a bit of information about that, the gist of that story—that yarn, so to speak—is that 118 of the 203 exercises that the SFO powers examined were found to be unlawful. The court was very scathing, therefore, about the conduct and rightly so. That provided the impetus, I suppose, to be where we are today to provide the SFO with their much more modern tools in a much more modern world that communicates in a very different way, and where—as has been said—the types of fraud that could be investigated are carried out in a very different format using very different mechanisms that require different tools.

The select committee clearly made several changes, as often happens at that process. That is why we have select committees. Again, whilst we’re here in urgency, sometimes that opportunity isn’t always afforded to every bill, and we’ve had several examples of—very recently—where snafus have had happened, mistakes have come to light, people have missed out on their winter energy payments. All sorts of things can happen because the select committee process wasn’t allowed to happen, and, therefore, things that could have been prevented weren’t, and real people paid real consequences as a result of that.

In this particular case, with the Serious Fraud Office Amendment Bill, the select committee made several changes to the bill. All were accepted unanimously, which only demonstrates further, therefore, that they were genuine things that could have improved the bill and did improve the bill and updated the bill. I won’t go through the list of all of those changes, but my colleague Dan Rosewarne touched on a couple of them, and they revolve around remote access, they revolve around additional requirements for remote access warrants, and I should imagine that the select committee process was somewhat interesting insofar as having people having to turn their minds to some of the things that we take for granted and some of those different ways of living life and how they apply to not only to making our life easier but also to how they can be used for nefarious reasons in terms of committing fraud.

As I said, we are happy to support this bill. There are some things—several things—that we will be raising at the committee of the whole House stage. There are possibly even some amendments, but there’s certainly a lot of points that colleagues and I will be raising over the next two or three hours as we investigate that stage of this bill. In the meantime, we commend this bill to the House.

Thank you, Mr Speaker. This bill provides additional tools for law enforcement; it is a further piece in the puzzle of restoring law and order, which is a priority under this Government. I commend this bill to the House.

Thank you, Mr Chair. This is actually quite a serious bill, and it deserves serious attention because it’s, essentially, about powers of search and seizure. It’s easy to kind of gloss over them and say what some people say, which is “just more tools in the toolbox”, but these tools in this toolbox enable a most serious invasion both of privacy and of house and home. We need to be very careful that the measures are appropriate, proportionate, and workable.

As some speakers have touched on, fraud, in particular, raises real challenges because it’s not like you’re looking for a bloody knife, or a smoking gun, or blood stains—you’re looking for information. Information in this modern world—the modern world that seems so difficult for Deborah Russell, who seems to wish email never existed, and I can sympathise with that in some regards—can be stored in all kinds of places and devices, whether it be a good old-fashioned notebook—which, actually, is still often a critical part of information in fraud cases—or an email, or a mobile phone, or a series of messages on Telegram or Facebook Messenger, or whatever it might be, where we can see that.

As has been noted, the case of R v Pikia was the impetus for this piece of legislation. The interesting thing—and I hope I haven’t missed something; well, maybe I hope I have missed something—about Pikia was apart from the overuse and broad nature of search warrants—so, search warrants were issued not quite randomly but frequently and extremely broadly. The general rule, when you’re going to search someone or something, is you make it specific and targeted and as limited as is necessary to obtain the evidence you’re after. Whereas in that case, the court found that the warrants lacked specificity—they didn’t even name an offence—they just said, “We think there might have been serious or complex fraud.”, not that there was documents used to procure a pecuniary advantage or that there had been an actual fraud under section ABC of the Crimes Act. It was just a general “we want to have a look,”, and they were frequent. They were called “unnecessary, unreasonable, and oppressive”.

The other thing with that case, though, was this—and this is the thing that perplexes me—you’ve got a need to tidy up the search warrant part of the Act, but section 9 of the Serious Fraud Office Act is the section that says the office can require someone to attend and deliver documents. I’ve seen this in operation, where they say, “You need to come to our office and give us all financial records of this company, and all affiliated companies, for the past five years.” It’s actually really, really onerous to do, and it’s deeply problematic if you don’t comply. What they were doing was saying, “You’ve got to deliver up to us your mobile phone and your laptop.” That’s not what section 9 says. It says you must deliver documents, and whichever way you cut it, a cellphone isn’t a document. It might contain documents, but it’s not a document. That was a real problem in that case, and that is actually the crux, in many ways, of why that prosecution failed, and why, after many years, including the Crown trying to get a Supreme Court hearing and being declined, it was ultimately discharged—all charges were dropped in 2024.

I’m not sure that the section 9 issue has been tidied up, and that’s actually a real worry for me, because there’s been a focus on getting the search warrants consistent with the Search and Surveillance Act, and that’s actually quite good—although I have some concerns, particularly around unlawful searches. But if the key, clunky bit of the Act, the most outdated bit of the Serious Fraud Office Act, is that cellphones aren’t documents, then we’ve got a real problem.

I’ll come to it in committee stage and the Minister can answer it, but it may be that the new definition of “thing”, which is a really weird definition of “thing”, in clause 4(1), tidies this up. It says a thing “includes an intangible thing”, and I can get that. A thing could include an email, which has no tangible form, but it also says: “for example, an email address or access information”—a passcode is a classic one, right? This is a really strange thing to call a “thing”, because whilst it’s information, it’s really not a natural language use of “thing”. I don’t know if that’s trying to get around it, or some other part of the definitions system, but if there’s a tidy-up there which means they’ve amended the Act, which affects section 9 without actually affecting section 9, I’d be very interested to know about that.

This was one of those pieces of legislation where we had a number of submissions on it, but to be fair, most people understood. I do want to recognise, and I think in any case where there’s a search, people need to understand how really confronting that can be. You’ve got to remember: this is not searching the house of someone who is guilty; this is searching the house of someone who may have committed a crime which is being investigated.

The other thing you’ve got remember is this—and in fact, I know people who this has happened to, where one family member might be a rogue, but that family member might also have a spouse and children in the same dwelling. Whilst there is provision in this bill that a search should be conducted at a reasonable time, searches are often conducted at times which are reasonable for the searchers, but not particularly reasonable for the people who are being searched—7 o’clock in the morning, to ensure that everyone’s at home.

You can kind of see why it happens, but when someone comes in and starts pulling books off your shelves to see if there’s anything’s hidden behind, and so on—the other thing, of course, is this: caution and constraint is needed, because the first thing that they want to do when they’re conducting a search is essentially to secure the area. The last thing they want is someone to nip into the back office and hit “erase”. It’s a little bit movie-like, but it’s not an entirely impossible scenario. They need to secure the premises, or at least that relevant part of it, but in doing so, they’re excluding the people—and it is often homes—who live in the home from the premises. Whilst that might be sitting at the kitchen table—which, in and of itself, if you’ve got people searching your home, and you’re there with your kids, essentially being told to sit down at the kitchen table and not move, that’s hard enough as it is—but it may even be that you’ve got to leave the premises entirely.

So we do need to be cautious, and I run through those scenarios because I think we too often—we watch too much NCIS, right? The heroes are the guys bashing down the door because there are some evil villains that are truly reprehensible. Serious fraud is a different kettle of fish, and serious fraud is serious. It’s a really bad thing. But, at the same time, we’ve got to recognise that there is collateral damage in prosecuting these particular cases, and that’s why we need to have a search framework where the search is targeted, limited, and appropriate, but also effective. That’s where the supervision, that we’ll talk about a bit more in committee stage, is really necessary.

We do support this bill, but I’m hoping—and imagining—officials will have heard some of my speech, and listened to perhaps some of the interesting bits, and they’ll be well prepared to talk about that section 9 issue in particular.

Mr Speaker, I support this legislation. I’m proud to be part of a Government that is shifting the dial on law and order.

It’s an absolute privilege to be able to stand and take this last call. I’m just pleased that it’s going to allow us to make sure that we’re not missing any of the detail as we prepare for the committee of the whole House stage. It is a very serious—no pun intended—issue that we’re talking about here, and I think it would be remiss of us to try to rush through this, even though we are, it would seem, in agreement on this.

We’re in agreement because it’s a really important issue, and we’ve taken the time through the process so far, previously when it’s been in the House, and also when it’s come through to select committee. I think it’s the same here, in this reading of it, and as we prepare to get into committee of the whole House, too, that we ensure that we are actually stepping through this, and taking the time to be across the detail. When we’re not across the detail, or we do rush things through, we’ve seen many recent examples of the negative impacts that that has on members of the public, and the detrimental impacts that can have on communities—much as was referenced in the speech from my colleague the Hon Dr Duncan Webb, who spoke about some of the unintended consequences of prosecuting or executing search warrants on people who may be in the same house or place as the person who’s having that search warrant executed.

I think the policy objective—the four key things of what we’re trying to do here—is to ensure that the Serious Fraud Office can obtain the information it needs, and if you are going to be prosecuting, you are going to need to obtain that information. It’s really important to ensure the process for obtaining a search warrant is efficient, and there are a lot of reasons for that, and a number of colleagues have spoken in detail about how the way the world operates has changed. That can sound like an old-fashioned, nostalgic thing, but it’s actually just the reality of where we are and how we operate in this day and age. That sounds like an old-fashioned thing too!

Thirdly, it’s to ensure that the Serious Fraud Office can execute a warrant effectively and with minimal risk to safety. That’s a really important one too. That’s the safety of those people from the Serious Fraud Office; it’s the safety of the people who may be being impacted by the search; and, ultimately, I guess, it’s the safety of the information, too, and that comes back to the timeliness piece as well. It’s also to ensure the test applied to unlawfully obtained evidence is appropriate, and consistent with the test applied in criminal proceedings more generally. I think that is also a very important piece as well.

Just conscious of the fact that the clock is running down on my time to step through some of the things that we’ve highlighted as being issues through this bill, and that we really need to explore, I did want to just touch on, and a number of us have, the ability for the Serious Fraud Office to, now, search things as well as places. And, I guess, one of the other important points around that is that there will also be platforms or apps or things on devices where data and information that could, actually, become key components of a successful prosecution will be stored; so ensuring that the Serious Fraud Office can get in there and get that in a really timely fashion. Some of those platforms that material disappears by itself; other platforms, it’s very easy for people to be able to make that information disappear even if they don’t have access to the device that the Serious Fraud Office or the person executing the search warrant has access to. So that timeliness, that speed is incredibly important.

I guess, when we look at how long it’s been—36 years—since this legislation was updated, and we and we reflect on how much the world has changed, how much technology has changed, how much the devices have changed, the ways we interact with each other, communicate, transact; it’s only natural for us to need to take the time to step very, very carefully through this legislation to make sure that, at this, almost, final pass, at the committee of the whole House, that what we are putting in place here is a framework that we can, hand on heart, say in this House, “We took the time, under urgency, to make sure that we didn’t rush this process; we got it right and we made New Zealand a safer and less fraudulent space as a result.”

Motion agreed to.

Bill read a second time.

DEPUTY SPEAKER: This bill is set down for committee stage immediately. I declare the House in committee for consideration of the Serious Fraud Office Amendment Bill.

Committee of the whole House

Part 1 Principle Act amended, and Schedule 1

Hon Dr Duncan Webb: Point of order. There being no Minister available, I move, That the House adjourn.

CHAIRPERSON (Teanau Tuiono): No, he’s just bringing in his people.

Hon Dr Duncan Webb: Oh, what a pity.

CHAIRPERSON (Teanau Tuiono): Members, the House is in committee on the Serious Fraud Office Amendment Bill. We come to the debate on Part 1. This is the debate on clauses 3 to 9—“Principal Act amended”—and Schedule 1. The question is that Part 1 stand part.