A “network of corruption” has been operating in the Hawke’s Bay gaming machine sector, prosecutors are claiming.

Charges relating to the alleged misappropriation of hundreds of thousands of dollars from the operation of gaming machines, or pokies, have been laid against eight people.

The charges have been laid by the Department of Internal Affairs (DIA), which regulates most gambling, including “Class 4″ gambling, which covers gaming machines operated outside of casinos.

“Prosecutions of this kind help us ensure the integrity and fairness of the gambling system,” the department’s gambling director, Vicki Scott, said on Thursday.

The DIA said in a statement that its investigation, which is understood to have been running for months, “found a network of corruption in the Hawke’s Bay region”, involving alleged collusion between Class 4 venue operators, corporate societies and grant recipients.

The DIA says the charges laid relate to the misappropriation of pokie grant funds, theft of gaming machine proceeds and offering benefits to secure Class 4 licences for pokie venues.

Three people appeared in Napier District Court on Thursday morning. One pleaded not guilty and two were remanded without plea on charges laid under the Gambling Act 2003 and the Crimes Act 1961.

The other five are due to appear in court next month.

The charges allege that those charged, who were in management positions at several community organisations and within the Class 4 gambling sector, abused their positions to fraudulently obtain or misappropriate hundreds of thousands of dollars in grant funding and other benefits.

“Criminal networks that operate in a regulated environment such as Class 4 gambling commit this type of offending with full knowledge of the law,” Scott said.

“They ultimately take away grants from compliant and honest organisations and give the gambling sector a bad name.”

Ric Stevens spent many years working for the former New Zealand Press Association news agency, including as a political reporter at Parliament, before holding senior positions at various daily newspapers. He joined NZME’s Open Justice team in 2022 and is based in Hawke’s Bay. His writing in the crime and justice sphere is informed by four years of front-line experience as a probation officer.