The Minister of Immigration is staying out of a row over how the founder of the Megaupload website, a millionaire accused of internet piracy, gained residency in New Zealand.
Immigration New Zealand says Kim Dotcom, 38, was granted residency in 2010 under the investor-plus category, which allows people to gain residency if they invest $10 million in Government bonds.
Before it was granted, Mr Dotcom disclosed he had previous convictions overseas. He is known in Germany as a computer hacker and was convicted of insider trading.
However, the Immigration Service says the issues with his character were outweighed by his potential benefit to the country.
Immigration Minister Nathan Guy will not comment because Mr Dotcom received residency by officials working at departmental level, and because the matter is now before the courts.
But Labour's immigration spokesperson Darien Fenton says Mr Dotcom should never have been allowed to live in New Zealand.
She says the incident raises serious concerns about the investor-plus category which she says allows wealthy people of dubious character to buy their way into New Zealand.
Internet commentator David Farrar says the shutdown of the Megaupload file sharing website is a shrewd public relations move.
He says it is a good PR move to target file sharing websites, which stand to gain money from piracy, rather than bit torrent websites where those prosecuted tend to be individuals.
However, Mr Farrar says bit torrents are much more popular than filesharing websites so the shutdown of Megaupload won't put a dent in online piracy.
Top lawyer engaged
An American lawyer who defended former President Bill Clinton against sexual harassment charges, is to represent Megaupload executives arrested in Auckland on Friday.
Four men appeared in the North Shore District court on Friday and will appear again on Monday, when extradition orders to the United States will be sought.
The charges include conspiracy to commit money laundering, racketeering and copyright infringement.
The company was indicted in a federal court in Alexandria, Virginia, USA, on Thursday.
Lawyer Robert Bennett told Associated Press he will vigourously defend the charges, but declined to comment on the case in detail.
Mr Bennett served as Mr Clinton's attorney when he was accused of sexual harassment, and also defended the energy company Enron against accusations of corporate fraud.
He also represented former US Secretary of Defence Caspar Weinberger, during the Iran-Contra scandal of the 1980s and Paul Wolfowitz in the World Bank scandal.