Australia is finally getting a federal anti-corruption commission – many decades after state bodies were set up to investigate allegations of wrongdoing by their politicians and officials.
The Albanese government this week introduced legislation to establish the National Anti-Corruption Commission (Nacc) and Peter Dutton has suggested the Coalition will back the bill.
With a federal commission set to start probing potential corruption in 2023, Guardian Australia takes a look back at the serious criminal and other conduct uncovered by state anti-corruption bodies over the past 20 years.
Eddie Obeid, Ian Macdonald and the NSW coalmining licence
In October 2021, former New South Wales resources minister, Edward Obeid, 78, his son Moses 52, and another former resources minister, Ian Macdonald, 72, were jailed for what was described in opening statements of the inquiry in 2012 as “corruption on a scale probably unexceeded since the days of the Rum Corps”.
It was vindication for the NSW Independent Commission Against Corruption which 10 years earlier had uncovered an elaborate arrangement to deliver a coalmining licence to the Obeid family in the Bylong Valley in the state’s Upper Hunter.
The two former Labor government ministers and Moses Obeid were found guilty of engaging in a conspiracy.
Eddie Obeid is serving three years and 10 months and his son three years for their part in seeking to procure Macdonald to wilfully commit misconduct in public office. Macdonald received an even longer sentence of at least five years and three months. Appeals have been lodged.
Macdonald issued a coal exploration licence then shaped the tender process to ensure the licence ended up in the hands of the Obeids’ preferred mining company Cascade Coal.
If the plan had gone unnoticed, the Obeids would have made $60m. By the time the conspiracy was uncovered, $30m had been paid to the family. It has not been recovered.
In sentencing the three men, Justice Elizabeth Fullerton said the “objective seriousness” of the offences was of “the highest order”.
The audacious scheme would probably never have come to light without Icac. Indeed, Obeid senior could still have been the kingmaker of the NSW Labor right.
But in 2010, investigators raided the Obeids’ street furniture business in Sydney’s inner West, finding a confidential map of the proposed area for the coal licence. They grilled the coal executives involved, a family friend who had “coincidentally” bought a nearby farm in the Bylong Valley, and the dealmakers who had acted as middlemen for the Obeids.
Icac subpoenaed files from lawyers, pored through tender documents and grilled bureaucrats about their instructions from then minister Macdonald.
Armed with that evidence, Icac finally called public hearings and the full shape of the conspiracy unfolded.
The counsel assisting at the time, Geoffrey Watson SC, coined the Rum Corps comparison. He’s now a director of the Centre for Public Integrity which is urging the Albanese government to adopt the NSW model with a lower bar for public hearings.
Watson says they revealed important evidence in the Obeid case and gave the public confidence in the process.
The developer and donations in a brown paper bag
NSW Icac’s list of successful investigations that have led to prosecutions is long and spans local government and misfeasance within the public service. But even when prosecutions don’t follow, Icac investigations can expose weaknesses in the political system.
In a state where property development can be a fast track to riches – and state and local governments have power over development approvals – allegations of public sector corruption are often linked to land deals.
In August 2016, Icac released its report into Operation Spicer, an investigation into alleged illegal developer donations to the NSW Liberal party on the Central Coast.
The public inquiries were riveting. Icac heard Liberal MP Andrew Cornwell had been offered $10,000 in a brown paper bag by the Newcastle mayor and developer, Jeff McCloy, while sitting in the mayor’s Bentley before the 2011 state election. Cornwell said he had given another developer, Hilton Grugeon, a painting as a Christmas present and Grugeon later offered to buy the painting from Cornwell’s wife for $10,120.
Cornwell stepped down from parliament after giving evidence.
The inquiry also delved into a business EightbyFive which was found to have been used to disguise banned donations.
Liberal MP and Central Coast powerbroker Chris Hartcher was found to have acted with the intention of evading laws that banned political donations from property developers, capped donations and required the disclosure of donations.
The inquiry also looked at the activities of Labor MP Joe Tripodi and his dealings with Buildev which had projects in Newcastle.
Icac recommended that the Director of Public Prosecutions consider laying a charge of larceny against Hartcher. This recommendation related to a cheque for $4,000 made out to the Liberal party as a donation but found by Icac to be deposited into an account controlled by Hartcher and later withdrawn in cash.
Icac recommended Tripodi be charged with misconduct in public office. No charges have been laid to date against either man.
In all, Icac found 20 people had broken the law. But it was not just a colourful local saga. Icac looked at the operation of the state Liberal party’s Free Enterprise Foundation and found a substantial portion of the $693,000 provided by the foundation for the 2011 state campaign came from banned property donors.
A smaller town but big scandals in Queensland
Queensland’s Crime and Corruption Commission emerged after the Fitzgerald inquiry into the relationship between politicians, police and brothel owners in 1980s Queensland.
The Fitzgerald inquiry was prompted by Phil Dickie’s coverage in the Courier Mail and Chris Masters’ ABC Four Corners report Moonlight State and revealed entrenched corruption at almost every level of law enforcement in Queensland.
Decades later, the CCC’s investigation into Ipswich council in 2017 revealed corruption never really goes away.
In June 2020, the former Ipswich mayor Paul Pisasale was sentenced to seven-and-a-half years in jail – with a non-parole period of 27 months – for 33 offences stemming from his time in office. He was already in jail for extortion.
The offences included fraud, official corruption, perjury, unlawful drug possession and two counts of sexual assault.
It was the last turn in the downward spiral for the man known as “Mr Ipswich”.
Pisasale, 69, served as mayor for 13 years, winning the 2016 council election with an extraordinary 83% of the vote.
But in 2017, was the subject of a CCC investigation, which culminated in raids on Ipswich council premises and his home the day before he resigned in June.
In April of that year, Australian federal police had stopped him at Melbourne airport carrying $50,000 in cash which was suspected to be proceeds of crime.
Pisasale was convicted of giving false testimony at a CCC hearing.
The official corruption charge related to Pisasale agreeing to champion a Yamanto real estate project. He was promised millions of dollars if sales went ahead as planned but instead received the services of escorts and two relatively small cash payments.
Then there were the trips to Cairns to see his girlfriend, lavish dinners and overseas trips at the council’s expense. How did it continue for 13 years?
“Pisasale got an easy run because he knew how to manipulate the media and his local popularity made him and his administration untouchable for 13 years. He could also be a vicious bully to anyone he considered a threat but who wasn’t protected,” wrote local investigative journalist Mark Solomons.
“Inside his administration, colleagues who owed him their jobs helped make sure internal complaints never saw the light of day, damaging documents were buried and whistleblowers silenced, fostering the toxic and corrupt culture later identified by the CCC.”
Pisasale read an apology to the court saying he started out trying to help the “beautiful people of Ipswich” but personal “obsession and a lack of judgment” took over during a dark period of his life.
Victoria’s Ibac and ‘the big wig’
Victoria’s Independent Broad-based Anti-corruption Commission (Ibac) is probably the lowest profile of the state watchdogs.
That could be because Victorians are more law-abiding than their NSW and Queensland counterparts.
More likely, it is due to Ibac’s restrictive criteria for holding public hearings: there must be exceptional circumstances (as is proposed for the federal Nacc) and be in the public interest. Even then, the hearings must be held without causing unreasonable damage to a person’s reputation, safety or wellbeing.
That doesn’t mean Ibac hasn’t claimed a few scalps – or wigs.
One sensational investigation probed corrupt conduct by officials in the Victorian education department which led to director Nino Napoli being sentenced in 2021 to three years and 10 months in prison.
His cousin Carlo Squillacioti received two years and five months and Nino’s brother Robert Napoli was handed a three-year community service order.
Known as “the big wig” – a reference to his hairpiece as well as his exalted position in the education department, Nino Napoli and his co-conspirators were found to have engaged in a plan to defraud the department.
Ibac’s investigation focused on allegations that senior departmental officers misappropriated funds from the department’s budget through false and inflated invoicing as well as arranging payment of inappropriate expenses including excessive hospitality, travel and personal items.
Counsel assisting Ibac Ian Hill QC said 17 companies linked to Napoli and nine of his relatives received more than $2.5m from Victorian schools between 2007 and 2014.
Investigating allegations of this type – inflated invoices, siphoning public money into fake businesses and kickbacks to officials – consumes a lot of the state corruption watchdogs’ time.
The National Anti-Corruption Commission will try to ensure there’s no misconduct when it comes to administering enormous budgets managed by federal politicians and bureaucrats – from multimillion-dollar IT contracts to multi-billion dollar defence projects. There’s scope for plenty of surprising and hair-raising revelations once the Nacc gets up to speed.
