NZ spy agency suspends law enforcement actions over scandal

One of New Zealand’s key intelligence agencies has suspended operations with the country’s law enforcement agencies after admitting it illegally intercepted the communications of a German millionaire wanted by U.S. authorities. Prime Minister John Key on Thursday released a report by Inspector-General of Intelligence and Security Paul Neazor into the unlawful interception of executives of the file-sharing website Megaupload, who are wanted by the U.S. on charges relating to alleged copyright violations and money-laundering. Key said the report and his own discussions showed the illegal interceptions by the Government Communications Security Bureau ( GCSB) were a result of human error. Under New Zealand law, the GCSB is prohibited from intercepting the communications of New Zealand citizens and permanent residents, but it failed to carry out its own checks on the residency status of Kim Dotcom and a fellow Megaupload executive. “First, the GCSB originally relied on the Police’s information about the residency status of the people in question. They did not check further,” Key said in a statement. “Second, this error was compounded after the operation was concluded by a simply wrong interpretation of the law.” Neazor’s report had noted the potential for confusion between the relevant agencies about changes to the Immigration Act in 2009 and the subsequent effect on the GCSB legislation. At the time in question, Kim Dotcom held a residence class visa, but it was not interpreted by the Police or GCSB that he fell into the protected category of permanent resident. “The GCSB relied on information provided to it by the Organised and Financial Crime Agency New Zealand. In my view, reliance on another party by GCSB is unacceptable,” said Key, who is the minister responsible for the GCSB.