Five big transactions found on money trail
Date March 6, 2013 178 reading now
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Head of the family: Eddie Obeid at ICAC. Photo: Edwina Pickles
Follow the Obeid money trail
By following ”the money trail” a forensic accountant has identified five main transactions made by the family of controversial Labor powerbroker Eddie Obeid using the proceeds of $30 million the family received from an allegedly corrupt coal venture.
Grant Lockley, a former fraud squad detective who is now a senior forensic accountant with the Independent Commission Against Corruption, also detailed the millions of dollars that flowed to Mr Obeid, his wife, their nine children and others from the deal. The inquiry heard Mr Obeid received $1.5 million from the suspect coal transaction.
The commission is examining whether the Obeids received inside information from then resources minister Ian Macdonald that allowed them to buy properties in the Bylong Valley before the government called for an exploration tender. The Obeids also gained a secret 25 per cent interest in the winning coal company. They have since received $30 million for that stake with the promise of a further $30 million.
The inquiry heard that from October 2010 to June 2011 $29,459,860 was paid via an Obeid front company to the Obeid Family Trust No 2.
Although her taxable income was only $80,000, Moses Obeid’s wife Nikki used $2.2 million of the coal money to buy a $4.5 million house in Vaucluse in May 2011, Mr Lockley said in his affidavit.
Two months later, Eddie Obeid used funds derived from the coal venture to purchase a $286,817 Mercedes S500.
He also used some of the funds to make repayments on his $1.12 million holiday unit in Port Macquarie.
His wife Judy Obeid used $407,500 for a deposit on a $8.15 million house in Woolwich. The purchase, which was revealed by the Herald in early 2011, did not proceed.
Mr Lockley also concluded the $3 million the Obeids paid to Australian Water Holdings, which he said also came from the coal venture, was wrongly recorded in the Obeid accounts as a loan. Mr Lockley said it should have been recorded as an investment.
Nick di Girolamo, head of AWH and an Obeid family friend, has told the Herald the $3 million was a personal loan from Mr Obeid’s son Eddie jnr.
Also giving evidence on Tuesday was the Obeids’ accountant Sid Sassine. He denied he was a ”frontman” for the family, but conceded that as their accountant his role was ”to hide the name Obeid from the general public to avoid the hindrance that they’ve consistently had … in doing business”.
Mr Sassine agreed the Obeids had made a ”pure profit” of $25 million on the coal deal yet they paid only $4.6 million in tax.
”Well how could that be so, Mr Sassine?” counsel assisting, Geoffrey Watson, SC, asked.
”Well, Mr Watson, it’s a capital gain,” Mr Sassine replied.
Solicitor John Gerathy, who has been described as a ”crucial witness,” was excused from giving further evidence due to mental illness.
”I have read the psychiatric reports … to the effect that his evidence cannot be relied upon and that being so and having regard to his illness I see no reason why he should be subjected to further examination,” Commissioner David Ipp said. The inquiry continues.
Read more: http://www.smh.com.au/nsw/five-big-transactions-found-on-money-trail-20130305-2fj4z.html#ixzz2Mf5Cdymp