Businessmen fear worst in ICAC inquiry, says lawyer


Businessmen fear worst in ICAC inquiry, says lawyer

Date February 22, 2013 123 reading now

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Kate McClymont

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Involved in suit … Neville Crichton, Denis O’Neil and John McGuigan. Photo: Michele Mossop, Robert Pearce, Rob Homer

SOME of the nation’s wealthiest businessmen are concerned a corruption inquiry might make findings of serious misconduct against them, including possible allegations of criminal conduct, their barrister told a Sydney court.

Multimillionaire car dealer Neville Crichton and his eastern suburbs property developing mate Denis O’Neil are suing Cascade Coal directors and a raft of other people who have featured in a sensational corruption inquiry.

The pair invested in Cascade Coal in November 2010, later discovering their $13 million investment had ended up in the coffers of the family of Labor kingpin Eddie Obeid.

Cascade has been at the centre of an Independent Commission Against Corruption inquiry.


Cascade, controlled by wealthy business figures including John McGuigan, John Atkinson and John Kinghorn, as well as mining magnate Travers Duncan, is alleged to have won a rigged government coal tender for Mount Penny in the Bylong Valley which covered several properties owned by the Obeids and their associates. The Obeids obtained a secret 25 per cent share of Cascade.

Bob Stitt, QC, is representing Messrs McGuigan, Atkinson and Kinghorn and Cascade Coal in the civil lawsuit taken by Mr Crichton and Mr O’Neil, which had its first day in court on Thursday.

Mr Stitt foreshadowed an application to have the case delayed until the ICAC hands down its findings.

He said possible ”allegations of criminal conduct and serious misconduct” could be made against his clients and that ”quasi criminal proceedings” should take precedence over civil proceedings.

Francis Douglas, QC, who is representing Mr Crichton and Mr O’Neil, told the Federal Court yesterday the pair thought they were part of a capital raising for Cascade, but only $6 was raised.

Instead, the two businessmen’s millions found their way, via a complicated route, to the Obeids.

Not only that, but Mr O’Neil’s $8 million investment and Mr Crichton’s $5 million investment was to result in ownership of 280,000 Cascade shares worth $46 each. The two men later discovered their shares were worth $0.0001 each.

Mr Crichton and Mr O’Neil want their money back, plus interest, and are alleging that many of the same cast of characters involved in the state’s most sensational corruption inquiry engaged in misleading and deceptive conduct.

The case has a list of 16 defendants which include investment banker Richard ”Digger” Poole and his wife, Amanda, whose bank account was used to channel their money through to a company controlled by the Obeids.

Also being sued are stockbrokers Brent Potts and Peter Gray as well as Southeast Investment Group, the front company used by the Obeids to hide their interest in Cascade.

A notable omission in the list of defendants is eastern suburbs wheeler-dealer Greg Jones, who kept his own investment in Cascade a secret due to his friendship with former minister Ian Macdonald.

Mr Jones introduced his friends Mr Crichton and Mr O’Neil to the Cascade deal. In an intercepted call played to the corruption inquiry, he said to Cascade director Mr McGuigan, ”Yeah, you think I’m really feeling terrific about having invited all those guys in through old acts of mateship?”

ICAC heard the proposed 2011 sale of Cascade to White Energy, which would have made Mr Jones and the other Cascade investors up to $60 million each, did not go ahead because of rumours of the Obeids’ involvement.

The case will be back in court for further directions in April.

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