The Wanganui District Council voted to ban gang patches during a meeting on Monday afternoon.
The Prohibition of Gang Insignia bylaw will give police powers to fine patch wearers $2000 and to take their gang insignia away from them.
However, divisions over the issue were evident during the meeting as three councillors walked out during the vote.
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The meeting continued without them and in the presence of gang members, the other councillors unanimously agreed to ban gang patches in parts of the town.
"There are people in Wanganui who will say we don't have a gang problem, but the fact is there is a gang problem in Wanganui, just as there is in other towns and cities," says senior councillor Randhir Dahya.
Opponents of the bylaw say they are planning to take to the streets to protest the move, with some gang members saying it breaches their bill of rights.
The idea of ridding patches from the town was first floated in early 2006.
Local residents wanted to make sure their voices were heard after the death of Wanganui toddler Jhia Te Tua.
The two-year-old was shot dead in her family home.
She was an innocent victim of gang conflict.
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