Former Australian Federal Police officer Ross Fusca has instituted proceedings in the Federal Court of Australia against the AFP under the Fair Work Act. As part of his evidence he alleges he was offered a promotion if he shut down the enquiry into the AWB oil-for-food scandal which he headed up when he was employed at the AFP.

It is set down for another directions hearing on the 16th August 2012 before Justice Susan Kenny in Melbourne. (Click here for Susan Kenny’s Bio)

Irrespective of Mr Fusca’s claims there is more than enough evidence to show a cover-up happened by the Federal Police and we will look at some of that evidence.

Ross Fusca’s case was reported on by the ABC’s 7.30 Report and The Age last month but they left out two key factors.

The first and most important is that AWB admitted they knew that they were bribing Saddam Hussein and the Iraq Government. This admission was made during the course of civil proceedings against AWB by its shareholders in February 2010.

The second, and this might not seem much, is that the former head of the AFP Mick Keelty closed down the AFP’s inquiry literally a few days before he retired and the new AFP Commissioner Tony Negus took over. I remember when it happened I thought to myself that Keelty is clearing out the dirty laundry so Negus would not have to take the heat at a later stage if it did blow up again. Given that it is the biggest bribery scandal to hit the country he should have left it to Tony Negus to deal with.

Background

This is what it says on Wikipedia: “The AWB Oil-for-Wheat Scandal (also known just as the AWB Scandal) refers to the payment of kickbacks to the regime of Saddam Hussein in contravention of the United Nations Oil-for-Food Humanitarian Program. AWB Limited is a major grain marketing organisation based in Australia. For much of the twentieth and early 21st century, it was an Australian Government entity operating a single desk regime over Australian wheat, meaning it alone could export Australian wheat, which it paid a single price for. In the mid-2000s, it was found to have been, through middlemen, paying kickbacks to the regime of Saddam Hussein, in exchange for lucrative wheat contracts. This was in direct contradiction of United Nations Sanctions, and of Australian law.”

“As a result of these bribes, AWB was able to secure 90% of the Iraqi wheat market, before being discovered in 2005. United Nations investigator Paul Volcker found that the Australian Wheat Board, and later AWB Limited, were not the only, but certainly the largest source of kickbacks to the Iraqi regime. The Australian Government also launched a Royal Commission, which recommended that criminal proceedings commence against 12 people. Ultimately, criminal charges were dropped by the Australian Federal Police. Several Australian civil cases were however successful. Since the payments were discovered, AWB Limited has undergone a major restructuring, losing its monopoly supply of Australia wheat exports, and appointing an entirely new management. However, its profitability continues to suffer.” (Click here to read more)

Cole Inquiry

The Cole Inquiry was set up in November 2005 in response to a United Nations inquiry that had found that AWB had bribed the Iraqi government. The Cole Inquiry findings were tabled to parliament in November 2006. AWB during the course of the inquiry were clearly withholding evidence. A number of the AWB managers had memory losses and withheld documents. But even so there was enough evidence for the inquiry to recommend criminal charges against 12 people. (Click here to read more)

Federal Police inquiry

Not long after Cole publishing his report in November 2006 the Federal Police started investigating. Some 2 1/2 years later Commissioner Mick Keelty announced that the Federal Police had dropped their investigation into AWB bribery scandal. Mick Keelty made this announcement on Friday the 28th of August 2009. He retired from the force on Wednesday the 2nd of September 2009 which he had announced a few weeks earlier.

This to me was very strange. Why would Keelty announce this only 3 working days before his retirement. As I previously said it looks like he was cleaning out the dirty laundry before Tony Negus took over as commissioner. It is worth noting the announcement was made on a Friday as well which reduces the media coverage. Governments and government agencies are well aware if you want to reduce media coverage announce it on a Friday. You will quite often see governments announce bad news on a Friday as do companies with bad news for shareholders.

The reasoning for dropping the investigation was in part at least based on legal advice from the barrister Paul Hastings QC. The Australian reported at the time: “The AFP announced yesterday that the decision to drop the investigation was made after a review of the evidence by senior barrister Paul Hastings QC, who declared the prospect of convictions was limited and “not in the public interest”.

And: “Based on the advice provided by Mr Hastings, and following consultation with the Australian Securities & Investments Commission, the Commonwealth Director of Public Prosecutions and the Commonwealth Attorney-General’s Department, the Commissioner of the Australian Federal Police, Mick Keelty, has decided to discontinue the Australian Federal Police investigation and to offer such assistance as is required to the Australian Securities & Investments Commission to assist that agency to complete its investigation,” the AFP said.

“It has hardly been a secret that the AFP investigation was under-funded and under-resourced, and it received little co-operation from AWB, which sees itself as a new entity, with all staff associated with the corrupt dealings having left.” (Click here to read the full article)

I find it amazing the opinion of one barrister can halt the prosecution in Australia’s biggest bribery scandal. Interestingly the Federal Police are refusing to release a full copy of Paul Hastings 39 page advice even though The Age applied under freedom of information laws. (Click here to read) They are claiming legal privilege. Maybe to keep themselves out of jail? And on what basis did Peter Hastings QC decide “not in the public interest?” I think the opposite would true that it would be very much in the public interest to charge these people given that the Cole Inquiry recommended charges and the gravity of what they did.

In fairness to Tony Negus when Ross Fusca’s allegations hit the media last month Mr Negus called a press conference and took the heat for the decision himself and did not try to blame Mick Keelty. Although one of his defences was a bad joke. He pointed to the fact that the AFP had charged numerous people in the Australian Reserve Bank, Securency and Note Printing Australia international bribery scandal. The problem is that AFP were caught out trying to cover that up. I did a post last year where the RBA bribery scandal gets mentioned titled “Pigs On The Run – The Australian Federal Police” (Click here to read the post)

Tony Negus said in relation to the RBA briberies in 2010:

“There was an initial assessment done of that material and at that time, over the coming months, it was decided that there was insufficient material to launch an investigation. Looking back, there could have been more done at that time, I think, to look further and deeper into the issue.”

“At a later stage there was more material provided to the Australian Crime Commission, which was again provided to the AFP; at about that time the matter was formally referred to us by the RBA after the matter was featured in The Age newspaper.”

And this is what he said about the Australian Defence Force sex tape scandal involving the 18-year-old girl, which the Federal Police also tried to cover-up and the girl was lied to and told that it was not an offence under ACT law: ‘That advice that was provided by defence didn’t really fully comprehend the magnitude of what we now know to be the case” The AFP attitude and advice changed once the media became involved. (Click here to read the post)

Shareholder class action against AWB

Shareholders launched a class action against AWB “because its share price collapsed after the Cole Inquiry revealed AWB paid kickbacks to Saddam Hussein’s Iraqi Government.” (Click here to read more) The class action was settled in February 2010 for $40 million. AWB gave the standard reasons why they settled, but the reality is that they did not want more evidence coming out about the bribery. When they settled they made the admission that they knew money was going to the Iraqi government. At the time it was reported “in a shareholder class action in the Federal Court, AWB admitted that it knew  a Jordanian trucking company was passing the money to Baghdad between 1999 and  2003.”

“John Agius, SC, who was counsel assisting the 2006 inquiry, said he was  astounded by the admission, which came after seven years of public denials.  ”There was no concession coming close to that at any time during the running of  the inquiry,” he said.” (Click here to read more)

Some of the evidence that came to light in court before AWB settled with shareholders was reported as such: “In his opening address, Sheahan, like Agius, said the documentary trail showed  unambiguously that AWB executives had known where the money was going. Sheahan  quoted from contemporaneous internal AWB correspondence, picking out phrases  like ”would breach UN sanctions”, ”as long as the link was not apparent that  the funds were going into Iraq,” ”the banking details that Iraq will  require,” ”with payment of the trucking fee we are prevented of doing this  direct to Iraq for obvious reasons” and ”we believe the increase in trucking  fee and addition of the service charge is a mechanism of extracting more dollars  from the [UN-supervised] escrow account”.” (Click here to read more)

The evidence against AWB was open and shut and to continue with the court case would have been suicide. But before they settled the new management had to admit that AWB knew that the money was going to the Iraqi government because if they did not they also could have been held accountable for bribing the shareholders to cover-up the crimes of the former management of AWB. It is interesting that they denied that the Australian government did not know about the bribes, denied that they knew it was a breach of UN sanctions and denied that they knew it breached Australian bribery laws.

Of course they knew they were breaching the UN sanctions and they would have been fully aware they were breaking Australian bribery laws. What AWB were saying about the government knowing was if you come after us given our admission we will take you down with us as we have the evidence to prove the government knew.

Ross Fusca’s Federal Court of Australia proceedings against the AFP

This came to light last month in a joint report by the ABC’s 7.30 Report and The Age’s Nick McKenzie and Richard Baker. As I said at the beginning they missed two issues that I believe were of importance.

The 7.30 report started off the program with:

The Federal police officer in charge of investigating claims the Australian Wheat Board paid kickbacks to Iraq says the AFP mishandled and prematurely shut down its inquiry.

LEIGH SALES, PRESENTER: There have been explosive claims by the former head of the Australian Federal Police taskforce in the Australian Wheat Board scandal.

The AWB crisis erupted in 2005 and led to a Royal Commission.

The wheat board had paid hundreds of millions of dollars in kickbacks to Saddam Hussein’s regime in Iraq. It was a severe embarrassment to the wheat board and the government of the day.

But even though the Royal Commission found compelling evidence of criminal action, the police investigation into the matter wound up in 2009 without a single person being charged.

Now the man who headed up that investigation, Ross Fusca, a decorated 30-year AFP veteran, says he was offered a promotion if he’d shut the inquiry down. (Click here for the full transcript or to watch the show)

Nothing new here from a viewpoint of the AFP shutting down politically embarrassing criminal cases. But now we have a whistleblower to confirm what many already knew. The AFP have plenty of form on the board for that.

The Age did two stories on Fusca’s allegations the first titled “Scandal? What scandal?”starts off:

THE GOLDEN rule of the electronic age is to think before you hit send. It is  why, in late 2008, the operational head of Australia’s biggest corruption probe  read and reread the missive he had prepared, pausing on the last few lines.

“I refuse to be treated like a fool,” the email said. “This is a high  priority AFP national investigation, the task is massive. If no proper effective  support is given and maintained, I recommend closing this investigation.”

At 3.18pm on  December 18, Ross Fusca, the acting co-ordinator of the AWB  oil-for-food taskforce,  hit ”send” and his 30-year career began a rapid  downwards spiral. Fusca was quickly disciplined and demoted. Worse would come:  stress leave, a humiliating return to work and, most recently, a Federal Court  action that details an explosive claim that Fusca was offered a promotion in  return for prematurely shutting down the police’s AWB inquiry. (Click here to read the full article)

The second titled “Top job ‘offered to end probe'” starts off:

THE man who led the Australian Federal Police investigation into the AWB  oil-for-food scandal has alleged he was offered a promotion in return for  shutting down the probe.

In an explosive statement lodged in the Federal Court, former AFP agent Ross  Fusca said another senior officer had told him that if he could ”make the  oil-for-food taskforce go away, he would be appointed as next  co-ordinator”.

“And he has claimed the police’s AWB taskforce – which ran between late 2006 and  August 2009 – had a high-level political informant who indicated that federal  government officials had been aware of AWB’s payment of kickbacks.” (Click here to read the full article)

Putting Ross Fusca’s claims aside for a moment, once AWB admitted in court that they knew that the money was going to the Iraqi government the Federal Police should have reopened their investigation then and there. Yes it was new management at AWB but they clearly made that admission because they had to before they settled the class action otherwise the settlement could and would have been construed as a bribe to cover-up the crimes of the previous management as I have already said.

The AWB management were in a fix. They could not settle with the shareholders without making the admission of bribery and neither could they let it go to full hearing with all the evidence that would have come out. Nor could they settle with the shareholders and make the admission of bribery while the Federal Police were still investigating as the Federal Police would have been left with no choice but to lay charges against the 12 people Cole recommended and the company. They badly needed the Federal Police to sweep it under the carpet first so they could settle with the shareholders to avoid the full hearing. As we know the Federal Police obliged.

Once you add Mr Fusca’s claims to the AWB admissions as well as the other evidence the AFP ignored then the government should be setting up an inquiry into the whole affair.

But this will never happen as the Liberals/Nationals have no incentive to support an inquiry as it happened on their watch and possibly some of their former politicians would be implicated. The Labor Party would not want to set a precedent as they have their own recent dirty laundry. The reality is they all fall into line like a Canberra Mafia when it comes to public service corruption. They are all happy to sweep it under the carpet. That seems to be AWB’s trump card, public servants would be implicated if any of them where ever charged and no one in the parliament or public service wants that. I did a post in October last year which is worth a read on this topic titled “The Canberra Mafia. How and why the Australian Federal Government conceal corruption.” (Click here to read the post)

Every Australian should be greatly disturbed how an Australian company, AWB, managed to get away with bribing Saddam Hussein $300 million and not be held to account. It is not just the Federal Police who have questions to answer but also the Commonwealth Director of Public Prosecutions, Attorney-Generals Department and not to mention the Federal Politicians. We can go to war to get rid of a tyrant like Saddam Hussein and his government but can not hold those who helped finance him responsable. It is a sad reflection on this country.

As for the Ross Fusca matter, I believe him as there is plenty of other evidence to support what he says as far as a cover-up is concerned. Whether or not his Federal Court matter will go to hearing is interesting. Do the Federal Police settle to cover up their corruption or do they let it go to hearing for the whole country to see?

It would be greatly appreciated if you spend a minute using Twitter, Facebook and email etc and promote this post. Just click on the icons below.

And make sure you follow this site by email which is on the top right of this page and about once a week you will get an email when there is a new post/story on this site.

This site is fully funded by myself, both time wise and monetary wise. If you would like to support the continuance and growth of this site it would be greatly appreciated if you make a donation, buy a t-shirt, coffee mug  or a copy of my book. The links are below.

If you would like to buy a t-shirt or coffee mug visit my online shop (Click here to visit the shop)

If you would like to buy a copy of my non-fiction book on corruption in the Australian judiciary that names names visit my website for the book which has links to the online bookshops. (Click her to visit the website)

Thank you for your support.