EXCLUSIVE

"I don't believe my family does anything shonky": Eddie Obeid snr.

"I don't believe my family does anything shonky": Eddie Obeid snr. Photo: Kate Doak

Nine members of the Obeid clan are locked in a dispute with the Tax Office as a series of corruption inquiries exposes the multimillion-dollar business dealings of the family empire.

Fairfax Media can reveal that family matriarch Judith Obeid, the wife of corrupt former Labor kingpin Eddie Obeid, and most of the couple's sons and daughters-in-law have simultaneously lodged Federal Court challenges to decisions by the Tax Office.

The concerted action raises the prospect that the Obeids have been hit with hefty tax bills following evidence before the Independent Commission Against Corruption.

Judith Obeid: Family matriarch among those lodging Federal Court challenges against the ATO.

Judith Obeid: Family matriarch among those lodging Federal Court challenges against the ATO. Photo: Nic Walker

Moses Obeid, the third of the five Obeid sons, and his wife, Nicole, are not a party to the action.

But his brothers Damian, Paul and Gerard, and their wives Carol, Lucia and Gwenda, all lodged separate notices to appeal decisions of the Tax Commissioner on May 30, along with their brother Eddie jnr's wife Maree.

An Edward Obeid has also launched a court challenge, but it is unclear from court records if this is a reference to Eddie jnr or the family patriarch.

In a report released last July, which dealt with the family's coal-rich farm, Cherrydale Park, the ICAC referred information about the operation of the Obeid family trusts to the Tax Office ''for such action as it considers appropriate''.

The inquiry heard the Obeids ran their business empire through a series of trusts, with millions of dollars in tax-free ''loans'' made to family members for everyday living expenses, including school fees and council rates.

The commission said in its report there was evidence to suggest the drawings were not loans and it would be ''open to the Tax Office to infer from the manner in which the trusts were operated that they were a sham''. ''In the event that these payments were not properly characterised as loans but were in fact distributions, then they would be taxable,'' it said.

Counsel assisting the ICAC, Geoffrey Watson, SC, asked Mr Obeid snr last year about several loans to him and his wife, including a $1.5 million payment into his loan account. ''It looks shonky, doesn't it?'' Mr Watson said.

''No, it doesn't look shonky,'' Mr Obeid replied. ''I don't believe my family does anything shonky.''

Paul Obeid, the second-oldest son, agreed in his evidence that trust account records were a ''shambles''.

A separate inquiry into the Obeid family's secret interest in harbour-side cafes at Circular Quay heard Judith Obeid was given a $1000-a-week ''housekeeping fee'' out of the cash takings from the businesses.

But the inquiry into Cherrydale Park heard evidence she did not file tax returns because she did not earn an income.

''I have a card, a Visa card, and my husband gives me money,'' Mrs Obeid said at the time.

The lawyer for the Obeids, Sydney solicitor David Deutsch, did not respond to a request for comment on Monday.

A Tax Office spokeswoman said they were unable to comment on the affairs of individual taxpayers.