Wellington: A New Zealand government-allied MP with links to Internet tycoon Kim Dotcom announced his resignation today after being found guilty of making false declarations about donations from the founder of the Megaupload file-sharing website.
The decision by ACT Party MP and former cabinet minister John Banks to quit politics reduced the ruling National Party-led coalition`s majority to two.
Banks, 67, who entered parliament in 1981, issued a statement today saying his resignation would take effect next Friday.
Banks had been under pressure to resign after he was found guilty of electoral fraud last week for falsely declaring donations relating to his failed Auckland mayoral campaign in 2010.
He is due to be sentenced on August 1 and faces up to two years in jail.
Dotcom, who is battling extradition to the United States, told the High Court he had donated USD 42,000 to Banks.
He said the politician asked that the cheques be made out in two 25,000 New Zealand dollars installments so the donations could be classed as anonymous under campaign funding laws.
Banks and Dotcom were close until the German immigrant`s arrest for alleged online piracy in January 2012.
He told the court he had no regrets over the donation that he gave to Banks, who "wanted to be my friend and had tried to help me. To me, USD 50,000 was an amount I made every six hours."
"He (Banks) called me a friend several times. Someone who says that cannot just run for the hills and duck for cover just because an allegation has been made," Dotcom said.
Banks said in his statement he had "always endeavoured to do the right thing. Consequently I am saddened at this turn of events."
The US Justice Department and FBI claim Megaupload and related sites netted more than USD 175 million in criminal proceeds, and cost copyright owners more than USD 500 million by offering pirated copies of movies, TV shows and other content.