PM's office part of shutdown on Dotcom tip off

Megaupload founder Kim Dotcom shares a backstage moment with Jemaine Clement after the Flight of the Conchords show. Photo / Supplied

The Prime Minister's office was involved in shutting down information showing one government department tipping off another over FBI interest in internet magnate Kim Dotcom long before he was arrested.

Emails released under the Official Information Act show staff at the Department of Labour took advice from "the PM's office" before dodging questions on a leaked email.

It came amid calls for an inquiry into the Government's handling of the United States request to extradite Dotcom, the founder of file-sharing site Megaupload. He and three colleagues face extradition to the US on charges of criminal copyright violation.

The High Court ruled last week that the search and seizure during the arrest was illegal - the third embarrassment suffered by the Crown on the issue.

In May, the Herald obtained a leaked email showing the Department of Labour's Immigration NZ officials passed information to the Overseas Investment Office about FBI interest in Dotcom shortly before his application to buy a mansion was rejected.

The email said: "Immigration NZ did not disclose whether or not the person who made the claim was from the FBI or whether or not that person had first-hand knowledge of the alleged FBI interest."

The information was passed from the OIO to then-Justice Minister Simon Power who blocked Dotcom's application to purchase his mansion in Coatesville. He did so within days of Land Minister Maurice Williamson reversing an approval to buy the property. They were told there was the "possibility" the FBI "may be interested in investigating Mr Dotcom because of his ownership" of file-sharing companies.

The Herald attempted to find out the basis on which the Department of Labour shared information with the OIO. The department was also asked how it learned of FBI interest in Dotcom before his arrest this year.

The Department of Labour said it made decisions case by case under the Privacy Act and Overseas Investment Act. It said it had learned Dotcom was of interest to the FBI because he owned Megaupload. It refused to supply any further information.

The email trail, released by the department under the Official Information Act, showed its media team "ignored" calls and deliberately delayed responding.

Documents returned by the department revealed it had consulted "the PM's office" on the issue.

External communications manager Mark Piercey, a former journalist of 27 years experience, wrote he was "still waiting on OK from 9th floor" before sending a response. About an hour later he wrote the department's acting chief executive Nigel Bickle had approved the response and "told PM's office".

Mr Bickle said Mr Piercey's comments in his emails at the time were "inaccurate". He said the communications manager had mistaken the Department of Prime Minister and Cabinet, rather than the "PM's office".

He said the information had been passed on as part of the "no surprises policy" and was appropriate in issues of "significant public interest".

Labour justice spokesman Charles Chauvel said the emails showed a level of "concern" at the highest levels of government which extended beyond an extradition request. He said the "no surprises policy" applied to informing ministers in charge of departments, not the PM's office or Department of Prime Minister and Cabinet.

STAFF REBUKED OVER EVIL' REMARKS

Two senior public servants have been reprimanded after calling a journalist they didn't want to deal with "evil".

The comments came in a release of information showing staff had "ignored five calls" from Herald journalist David Fisher on an issue relating to Kim Dotcom.

The unnamed staff member used the subject line: "Evil jou(r)no".

Then-communications manager Anna Thomson emailed a colleague, calling Mr Fisher a "crazy man".

The staff avoided speaking to the journalist, eventually emailing to say no further information would be forthcoming.

Department of Labour acting chief executive Nigel Bickle apologised, saying media staff had failed to meet standards of "integrity, respect and excellence".

He stood by the department's decision not to release information which had been passed in confidence to the government by an unnamed foreign power.

His response came a month after staff refused to offer any reason for dodging the question.