Two properties and over 20 vehicles seized as part of investigation into ‘predatory’ company

Wednesday, 2 August 2023

“Predatory” is how a gambling expert is describing a North Canterbury company being investigated for potential illegal gambling.

Maria Bellringer, director of AUT’s Gambling and Addiction Research Centre, is concerned by how Rangiora-based Jonez LRC could be breaking gambling laws, and how much profit its owner could be making.

The company was selling ‘packages’, which included several entries to a draw to win what the owner described as “life changing” prizes, such as sports cars, a house worth about $900,000, or cash prizes.

The more people spent, the more entries they got. Winners were drawn by a machine with lottery balls, with the results livestreamed to over 70,000 Instagram followers.

Last week, a Department of Internal Affairs spokesperson confirmed it was leading an investigation into Jonez LRC Ltd.

Owner Waiariki Jones, 23, denies running a lottery. He called it a “trade promotion”, and said part of the ‘package’ was temporary access to discounts at retailers across Aotearoa.

According to Government guidelines, a sales promotion is a type of marketing exercise for a company and its goods or services.

Bellringer questioned what goods or services Jonez LRC was promoting, as it only appeared to promote future giveaways on its social media channels.

Although the company’s bio mentioned being New Zealand’s number one rewards club, there were very few references to the club in the posts the company made.

Jones registered Jonez LRC in 2021 as a car dealership. Until about mid-2022, the company almost exclusively used its social media channel to advertise vehicles for sale.

That changed in July 2022 when, after two months of hype, Jonez LRC gave away its first prize, a 1988 Nissan Cefiro. Jones encouraged people to “purchase as many entry’s (sic) as you like”.

In the year since, the comments section has been littered with people thanking Jones for his work. The few who questioned the legalities of the business were scolded by followers.

Some followers claim to spend $100 or more every week on entries.

In one comment, Jonez LRC said at least one person every week spent over $1000 on entries.

“It looks like gambling to me,” Bellringer said.

The company increased its legitimacy by inviting Richard Peters, a Rangiora-based Justice of the Peace, to authenticate the company’s first draw, then subsequent draws where the prizes had a high value.

In one video, Jones said in appreciation for Peters’ service, the company donated money to a charity of his choosing.

Despite Peters not having assisted a draw in several months, Jones’ supporters continue to reference him as proof the company was working within the law.

Peters told The Press he took Jonez LRC at its word that what it was doing was legal.

A Christchurch woman, who asked to remain anonymous, saw an ad for the house giveaway on social media.

Although memberships were referenced in the description of the package deals, she said her focus was on how many entries each package (labelled bronze, silver, gold or platinum, depending on cost) had.

Upon receipt of her $50 purchase, she was offered a 50% discount if she made another order in the next 10 minutes, which she took up.

Ballringer said being misleading, manufacturing a sense of urgency, and encouraging people to spend more money to improve their odds were “red flags”. It seemed “predatory”, she said.

Jonez LRC does not have a gambling licence. Without one, there was no obligation to put in protections for people who might have issues with problem gambling, Bellringer said.

She also questioned how much Jones and his company - for which he was the sole shareholder and director - could be profiting.

On July 20, investigators seized 19 vehicles that were in Jones’ name, including a 1970 Ford Falcon and a yellow 1992 Mazda RX-7, and five vehicles in the company’s name.

Jonez LRC also had two properties seized.

Jones previously told The Press the company was making a profit.

He has not responded to requests for comment since.