New Zealand First leader Winston Peters says he has not misled the public over a $100,000 donation made by Owen Glenn in 2006.
Mr Peters had repeatedly denied reports in the New Zealand Herald that the Monaco-based businessman gave money to the political party.
However, on Friday night Mr Peters said he had only just been made aware of the $100,000 donation, which was made through his lawyer Brian Henry.
At the party's annual conference on Saturday, Mr Peters said the donation was not illegal and was not made to New Zealand First.
He repeated his calls for the New Zealand Herald to apologise for their claims.
"They are wrong, they are categorically wrong. They got all the facts wrong and I still say they should apologise," he says.
Mr Peters said the money instead went towards the costs incurred during the Tauranga electoral petition at the last election, and neither he nor his party ever received a cent of it.
He says Mr Henry has been involved with fundraising money to meet the costs of litigation involving politicians and had a strict policy of never disclosing the source to the politicians involved.
"My lawyer has broken privilege, with my consent, and made those facts known," he says.
The New Zealand First leader says that since 1991, about $200,000 has been donated toward the legal costs of the Tauranga petition.
Mr Peters, who is also the Foreign Minister, says there has never been any suggestion that Mr Glenn could be the Honorary Consul of Monaco.
National demands explanation
The National Party says confirmation of the donation leaves the Government with a lot of explaining to do.
National's deputy leader Bill English says the Prime Minister should explain why she took no action to get to the bottom of contradictory claims this week.
He says other questions include whether Helen Clark is happy that her Foreign Minister has met his disclosure obligations as a minister in her Government.
A spokesperson for Miss Clark says she will not comment on the revelations, as it relates to a party matter.