A major scandal has hit New Zealand’s poker machine market, as four individuals have been charged with defrauding the system to the tune of $30 million. HRNZ chairman Patrick O'Brien and three others have appeared in court this week over the manipulation of poker machine grants.

Patrick O’Brien has been charged along with his son Michael O'Brien as well as another individual named Paul Anthony Max and one other person who has been granted name suppression. Patrick faces two charges of obtaining by deception (over $1000).

He seems to be no stranger to controversy, as Mr O’Brien was the former chairman of Bluegrass Holdings Ltd – another organisation that was accused of misappropriating poker machine grants. His son, Michael O'Brien, faces 15 charges of obtaining by deception (over $1000). Paul Anthony Max and the man with name suppression faces 13 and 2 charges of the same charge, respectively.

The DIA, SFO and the Organised and Financial Crime Agency of New Zealand worked together to uncover the crimes as part of a Class 4 investigation called Operation Chestnut. Only a few details about this project have been made available, but it is likely a response to the increasing number of pokie grant fraud cases in New Zealand.

Over the course of the past few years, there have been man cases of pokie fraud as organisations that are meant to distributing grants fairly have been shirking their responsibilities. "While we cannot talk about the detail of the allegations while they are before the court, the charge of obtaining by deception is a serious offence,” says Maarten Quivooy of the Department of Internal Affairs.

“The criminal charges are just one aspect of the Operation and we're working hard to use what we've learnt during the investigation to lift compliance in the sector," he said. The four individuals who have been charged will return to court on March 20, 2015.