ICAC zeros in on Liberal Party donations
Former minister Chris Hartcher, a sham company called Eightbyfive and thousands of dollars of political donations are all in the cross-hairs of the latest Independent Commission Against Corruption inquiry.PT2M26S http://www.canberratimes.com.au/action/externalEmbeddedPlayer?id=d-37e51 620 349 April 28, 2014
Hundreds of thousands of dollars in illegal political donations were used to bankroll the Liberal Party's 2011 state election campaign after being funnelled through slush funds linked to former minister Chris Hartcher and fund-raiser Paul Nicolaou, a corruption inquiry has heard.
The Independent Commission Against Corruption inquiry into fund-raising and influence-peddling in the NSW Liberal Party, codenamed Operation Spicer, opened on Monday with explosive allegations that Mr Hartcher and fellow central coast Liberal MPs Chris Spence and Darren Webber corruptly solicited more than $400,000 in campaign donations in return for political favours.
Among the donors were Nathan Tinkler's property development group Buildev, the Obeid-linked company Australian Water Holdings and Gazcorp, the developer behind the controversial Orange Grove shopping centre development in Liverpool.
Explosive allegations: Former energy minister Chris Hartcher. Photo: Glenn Hunt
Mr Hartcher, who quit cabinet last year after the ICAC raided his central coast electorate office, allegedly laundered some of the cash through a Central Coast law firm, which was "dragged ... unwittingly into an illicit enterprise".
The payments were made to Eightbyfive, a "sham" company set up by Mr Hartcher's former adviser Tim Koelma to disguise the donations as payment for services by providing fake invoices. The bulk of the money came from property developers, who have been banned from donating to political parties in NSW since 2009.
Marie Ficarra, the former parliamentary secretary to Premier Mike Baird, stood aside on Monday and moved to the crossbenches after the inquiry heard allegations she directed prominent developer Tony Merhi to donate $5000 to Eightbyfive.
Her spokesman said she "denies the allegations completely" and would present evidence to show she was innocent and "acted in good faith at all times".
But counsel assisting the commission, Geoffrey Watson, SC, said that both Ms Ficarra and Mr Merhi "knew they were doing the wrong thing".
The inquiry heard Mr Hartcher and Lane Cove MP Anthony Roberts, who took over the energy portfolio after Mr Hartcher's resignation, enjoyed a Whitsundays snorkelling holiday in 2007 on board the Octavia, an 82-foot luxury yacht owned by the late property developer Nabil Gazal and his sons Nabil and Nicholas. The family's company, Gazcorp, allegedly channelled $137,000 to Eightbyfive for "fake services".
Mr Watson suggested that as result of the payments, Mr Hartcher assisted the Gazals to get the Orange Grove shopping centre approved. Mr Roberts, who did not declare the trip on the pecuniary interests register, insisted it was a private trip and he paid his own airfares and costs.
The inquiry heard Mr Hartcher's office used the Liberal Party's chief fund-raising body, the Millennium Forum, and an organisation called the Free Enterprise Foundation to "re-channel" about $165,000 in donations from banned donors.
The foundation was allegedly used by members of the NSW Liberal Party to disguise illegal donations by "washing and re-channelling" payments, and it received $700,000 before the state election.
"Not all of that came from prohibited donors, but a substantial part of it did," Mr Watson said.
Liberal Party fund-raiser Mr Nicolaou, who resigned as chairman of the Millennium Forum in April, agreed in private evidence at the ICAC that the Free Enterprise Foundation was used to hide payments from prohibited donors. He said this included one of the nation's largest developers, Harry Triguboff from Meriton.
But Meriton said on Monday it had donated $50,000 to the foundation "on the basis that it be used for the federal Liberal Party", which does not ban developer donations.
The inquiry heard Mr Nicolaou, on the letterhead of the Millennium Forum, urged 2GB broadcaster Alan Jones to use his radio program to destroy the career of Kerry Schott, then head of Sydney Water.
At the time, Dr Schott was standing in the way of a lucrative public-private partnership for Australian Water Holdings, which donated $183,000 to Eightbyfive.
Mr Baird said on Monday he was "shocked and appalled" by the allegations. He told newly appointed NSW Liberal state director Tony Nutt to "investigate the allegations made at ICAC and respond to them promptly – including by dealing with any payments that have been made to the party in contravention of the law".
"If any wrongdoing is found, the book should, and will, be thrown at the perpetrators," Mr Baird said.
Mr Watson said Mr Tinkler's horse stud, Patinack Farm, donated $66,000 to Eightbyfive. Mr Hartcher "repeatedly granted favours" to the donors, including Mr Tinkler's property development group Buildev.
"It is a fact of political life that it is hard to close the door on a political donor," Mr Watson said.
Former Newcastle Labor MP Jodi McKay reported Mr Tinkler to the ICAC when he offered to support her 2011 election campaign financially and told her he could get an employee to act as a "front" for the payments.
The inquiry heard Police Minister Mike Gallacher was on "first-name terms" with Mr Tinkler's associate Ray Williams and Mr Williams texted Mr Gallacher in March 2011 to set up a "lunch or dinner".
with Anne Davies