Former Labor MPs Face Fresh Corruption Charges

Former NSW Labor ministers Eddie Obeid, Joe Tripodi and Tony Kelly have been hit with fresh corruption allegations and may face criminal charges.

A report arising from an ICAC corruption investigation has recommended that findings be referred to the Office of the Director of Public Prosecutions (DPP), for potential prosecution:

“Consideration should be given to obtaining the advice of the Director of Public Prosecutions with respect to the prosecution of Edward Obeid Sr, Mr Kelly, Mr Brown and Mr Tripodi for common law criminal offences of misconduct in public office”, the report read.

The recommendations arise from the identification of “deceptive” cabinet submissions allegedly designed to benefit the Obeid family.

Operation Credo

The ICAC inquiry, codenamed Operation Credo, probed the alleged connections between members of imprisoned former Labor minister Eddie Obeid’s family and the controversial water infrastructure company, Australia Water Holdings (AWH), which was vying for a lucrative NSW government contract.

In 2010, the Obeid family secretly agreed to buy a $3 million stake in AWH, despite claims the money was purely a loan.

Key Players

The report has technically cleared high-level Liberal figures, including federal senator and cabinet minister Arthur Sinodinos, as well as Liberal powerbroker and former AWH chief executive Nick Di Girolamo.

However, suspicions remain regarding the knowledge and/or involvement of Mr Di Girolamo, who allegedly knew claims the money was just a loan were false. Incidentally, Mr Girolamo was the Liberal Party lobbyist who gave former NSW premier Barry O’Farrell the $3,000 bottle of wine that led to O’Farrell’s resignation.

Senator Sinodinos was questioned at length about failing to investigate exorbitant expenses charged by AWH to the state-owned utility Sydney Water. However, he was also ultimately cleared of wrongdoing.

The Findings

ICAC’s findings include that Mr Obeid’s former ministerial colleagues, Mr Tripodi and Mr Kelly, doctored a cabinet minute in 2010 as a favour to Obeid.

The original cabinet minute recommended the rejection of AWH’s proposal that it enter a private-public deal with the government to provide water infrastructure. But the minute was altered so as inaccurately suggest that the proposal was approved by cabinet.

Both Mr Kelly and Mr Tripodi denied any wrongdoing, but their alleged roles were described during the investigation as “tantamount to fraud”.

Another party, Mr Obeid’s chief of staff Laurie Brown, admitted to ICAC that he had deleted facts from the original cabinet minute that showed the state-owned Sydney Water would be hundreds of millions of dollars worse off if AWH’s proposed public-private partnership were accepted.

The cabinet minute was later withdrawn at the insistence of then-premier Kristina Keneally. Had the proposal been accepted, around $60m of state money would have flowed to Obeid, his family, and associates.

Obeid Sr was also found to have actively lobbied other members of the government to accept the public-private proposal.

Premier Talks Tough

NSW premier Gladys Berejiklian has promised her government will not tolerate corruption in office.

“The NSW government has a zero-tolerance approach to corruption and we have implemented a range of measures to reflect this,” she stated to the media.

The findings of Operation Credo are the second against Kelly, and the third against Tripodi. The two government ministers were charged with leaking confidential documents to gain a financial benefit, failing to disclose other financial interests and backdating documents.

Mr Obeid court case found him guilty of several counts of corruption. He was sentenced to 5 years in prison for failing to disclose his family’s business interests in Circular Quay leases, while lobbying senior bureaucrats about the rights of waterfront retailers when he was a member of the NSW Upper House.

The Liberal Party, meanwhile, recently stood down 10 NSW Liberal MPs over illegal political donations. ICAC has heard that these MPs were receiving donations from property developers, who were banned from donating to political parties during the 2011 election campaign.

The Liberal Party was found to have been using the ‘Free Enterprise Foundation’ and ‘Eight by Five’ to ‘wash’ donations received from developers and other banned donors.

So while Ms Berejikilian talks tough, it is important that her words are followed up with actions to minimise the level of corruption in parliament.