The Security Intelligence Service is believed to have been monitoring a former MP's foray into the world of top-secret spy planes.
Trevor Rogers is understood to have raised suspicions after boasting about his plans to develop a full-size unmanned helicopter for civil and military use.
Mr Rogers, who was an Auckland city councillor from 1977 to 1989 and a National Party MP from 1990 to 1996, refused to comment.
But a Herald investigation has revealed he talked openly about the helicopter's "stealth" capabilities, distributing photographs of a prototype carrying what appeared to be missiles.
In 2009, a year after the collapse of his company, TGR Helicorp, he issued a press release saying "the programme is far from becoming history".