State Service Commission to investigate claims Southern Response used private investigators to spy on Christchurch quake claimants

Wednesday, 7 March 2018

Southern Response engaged a contractor to investigate Christchurch earthquake claimants due to the 'escalating level of threatening' behaviour toward its staff, the company's chairman says. 

The State Services Commission announced on Wednesday that it will investigate whether Southern Response contracted private investigators in breach of integrity and conduct standards. 

Stuff understands the Crown-owned claims management company used the investigators to spy on earthquake claimants. 

State Services Commissioner Peter Hughes said the inquiry would focus on Southern Response, which is responsible for settling claims by AMI policyholders for Canterbury earthquake damage, and a contractor it hired. 

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In a statement, Southern Response board chairman Ross Butler said the company would 'cooperate fully' with the inquiry.

'At the time the contractor was engaged in early 2014, Southern Response was acting in response to an escalating level of threatening and aggressive behaviour and communications from customers towards staff, the chief executive, directors, and the chairman.'

Police and security guards attended the company's annual meeting at Addington Raceway in 2014 after a threat was made.

Security staff manned the doors, searching bags, while police officers monitored people who entered. The nature of the threat, which was made before the meeting, was not revealed. 

On Wednesday, Butler said Southern Response sought external help to review its security 'given the environment the company was operating in at the time, and conscious of its obligations to ensure the safety of its staff'.

The contractor was asked to provide 'independent security advice' and assess the risk to the safety of the company's employees and directors..

'The health, safety and wellbeing of personnel, customers and workers involved on the Southern Response project are of prime importance at Southern Response. Our staff have a right to be able to interact in an environment safe from threats or harm, and the board has taken zero tolerance stance in respects of threats and hostile behaviour towards them,' he said.

Greater Christchurch Regeneration Minister Megan Woods had received information relating to Southern Response and its use of 'security contractors', her spokesman said. 

She referred concerns she had about this to the State Services Commissioner on February 16.

It is understood the Commissioner had looked at the allegations since then and decided they warranted scrutiny. 

'I have decided the appropriate course of action is an inquiry,' Hughes said in a statement. 

'The material I have seen raises questions around compliance with standards of integrity and conduct for state servants. Those questions need to be answered.'

The inquiry will be conducted using the Commissioner's powers under the State Sector Act 1988.

The Commissioner would announce who will lead the inquiry, and the terms of reference, by the end of next week.

As a Crown-owned entity, Southern Response is subject to the State Services Standards of Integrity and Conduct, which includes acting 'lawfully and objectively', and using resources 'carefully and only for intended purposes'. Private firms hired by a Crown entity are subject to the code.

Southern Response has had a rocky history in post-earthquake Christchurch. The company was the target of protests in 2013 and a 'Southern No Response' campaign that criticised slow or reduced claims settlements. 

Earthquake insurance critic and former Christchurch city councillor Ali Jones said she was not aware of any activity by private investigators, but knew insurers monitored protest groups such as Southern No Response. 

'Every meeting that we went to . . . we did say there could be people in the room from the insurance sector. 

'Sometimes we would find that we would post things on the Facebook page for example, and then someone would get a phone call asking about a specific issue that had been raised on the page. We knew that, and how do you stop that?'