Prime Minister Scott Morrison’s best mate and closest political advisor, David Gazard, is profiting $millions from the $50 billion submarine contract Australia finalised this week with the French state-owned shipbuilder Naval Group. Naval Group is still under investigation for bribing Malaysia’s former leader Najib Razak US$128 million.
What is becoming clear is that the $50 billion submarine contact is a money grab for numerous Liberal Party cronies which is disturbing given Naval Group was previously investigated by the Australian Senate in 2016 for bribery in Australia via one of their subsidiaries.
Firstly, we’ll look at the bribery allegations against Naval group and Naval Group’s former Australian operations CEO Sean Costello who was a former Liberal Party staffer and then David Gazard’s relationship with Prime Minster Scott Morrison and Naval Group.
Bribery Allegations against Naval Group – Formally known as DCNS and one of their subsidiaries is Thales. So, they are all the same company.
The bribery allegations against Naval Group have never been publicly addressed by the Government and they should have. Naval Group have history of employing consultants to pay bribes which makes the Liberal Party connections to the $50 billion submarine contract even more worrying.
On the 1st of May 2016 I published an article titled “Bribery allegations against Australia’s $50 billion submarine contract winner” and wrote:
Australia has just awarded a $50 billion defence project to build Submarines and even before the ink is dry on the contract hundreds of thousands of dollars if not millions of dollars have landed in the pockets of Liberal Party crony and former staffer Sean Costello. To make matters worse the French company DCNS which has won the $50 billion contract is currently under investigation by a French court for bribing Malaysian officials to win their submarine contract in 2002.
DCNS is alleged to have bribed officials linked to Malaysian Prime Minister Najib Razak and the corruption also involves allegations of murder. This is on top of other previous allegations of bribery against DCNS.
Another suspicious element of the Australian tender is that DCNS employed former Liberal staffer Sean Costello as its CEO for the bid. Mr Costello was chief-of-staff for former Defence Minister David Johnston who was sacked from his position in 2014.
The below video is Sean Costello on the Lateline show 26/4/16. Costello resigned as CEO of DCNS Australia in March 2017 less than a year after they won the contract. DCNS won the contract in 2016 but the final detailed contract was only signed this week.
The video above is Sean Costello on the Lateline show 26/4/16 and raises many questions. (Click here to watch the full story)
DCNS, Malaysia bribes, murder and the French court case
It has been reported in the media since January 2016 that the French are investigating DCNS for bribing Malaysian officials including the Prime Minister Najib Razak. The SMH reported:
A case involving allegations of high-level bribery, blackmail, betrayal and the murder of a glamorous Mongolian socialite in Malaysia has resurfaced in France, only days after Malaysia’s prime minister Najib Razak was cleared of corruption charges at home.
French prosecutors have charged a French businessman involved in Malaysia’s $US2 billion ($2.8 billion) purchase of two French-Spanish built submarines with paying illegal kickbacks to a Malaysian official linked to Mr Najib, according to the French newsagency AFP. (Click here to read more)
In March 2016 the ABC’s Four Corners screened an episode on Malaysian Prime Minister Najib Razak called “State of Fear” which covered the many corruption scandals surrounding the Prime Minister. It also covered the Submarine bribery scandal and said this:
LINTON BESSER: Accusations against prime minister Najib date back almost a decade.
The first scandal was in 2002, when Najib Razak was defence minister overseeing a $1 billion submarine deal between Malaysia and France. It embroiled some of Najib’s closest confidants in allegations of kickbacks, cover-ups and another murder.
French authorities have indicted the former head of French arms firm Thales. They acted after an investigation by Malaysian anti-corruption campaigner Cynthia Gabriel into a US$108 million commission paid to a Malaysian company.
CYNTHIA GABRIEL, ANTI-CORRUPTION CAMPAIGNER: It wasn’t just this payment that was of question: ah, it was a couple of other payments as well that were made that seemed murky and seemed very shady; that did not have very clear, um, ah, reasons for why, ah, the payments were made.
LINTON BESSER: The middleman in the submarines deal was a senior adviser and friend to the prime minister. His name is Razak Baginda.
CYNTHIA GABRIEL: We don’t know who he is, apart from him being a close associate and friend of, ah, Najib.
Ah, so I think today we are not certain if he was actually on a formal contract with the Defence Ministry, or whether he was just negotiating a very large multi-million dollar contract, only because he was the friend of Najib Razak.
TERENCE GOMEZ: The allegation is that kickbacks were given to the middle-men who negotiated the deal in France. That is the allegation. That allegation now has to be investigated properly.
LINTON BESSER: What thrust the corruption scandal into the global spotlight was another murder. This time, the victim was a 28-year-old model from Mongolia named Altantuya Shaariibuu. She worked as a translator.
It’s also been alleged she was having an affair with Najib, something he’s always denied.
But his adviser, Razak Baginda, was sleeping with her.
CYNTHIA GABRIEL: He did admit that they were having a romantic relationship for a while. And then the events that led to her death suggested that he was trying to get rid of her.
LINTON BESSER: The model, Altantuya, wanted a cut of the money from the submarine deal. (Click here to read more or watch the show)
The French arms firm, Thales, mentioned above owns 35% of DCNS and was allegedly involved in the bribery.
DCNS’s involvement in bribery and scandals has long been known as their Wikipedia profile shows:
The DCN / DCNS plays a major role in “one of France’s biggest political and financial scandals of the last generation [that left] a trail of eight unexplained deaths, nearly half a billion dollars in missing cash and troubling allegations of government complicity” connected to a sale of warships to Taiwan in the 1990s.
Apart from the issues surrounding the sale of ships to Taiwan mentioned above, French prosecutors started investigating a wide range of corruption charges in 2010 involving different submarine sales, with possible bribery and kickbacks to top officials in France. In particular interest by the prosecutors are sales of Scorpène submarines to countries like India and Malaysia.
The investigation in Malaysia has been prompted by human rights group Suaram as it involved current Prime Minister Najib Tun Razak when he was defence minister and his friend Abdul Razak Baginda whose company Primekar was alleged to be paid a huge commission during the purchase of two Scorpène submarines. French investigators are interested in the fact that Perimekar was formed only a few months before the contract was signed with the Malaysian government and DCNS and that Primekar had no track record in servicing submarines and did not have the financial capability to support the contract.
Investigations have also revealed that a Hong Kong-based company called Terasasi Ltd in which the directors are Razak Baginda and his father, sold classified Malaysian navy defence documents to DCNS. (Click here to read more) (Click here to read the full article)
The US$128 million bribery of Najib Razak is still being investigated and this week (12/2/19) it was reported a French lawyer went to Malaysia for meetings with officials still investigating the corruption. (Click here to read more)
The Australian Senate Inquiry
On the 5th May 2016 I published an article titled “Australian Senate corruption inquiry investigating $50 Billion Submarine contract winner” and said:
The Australian Senate are already investigating corrupt conduct by French arms firm Thales who are the parent company of DCNS which won the $50 billion Submarine contract. They are in effect one company and why the government didn’t address this issue when they announced DCNS as the winner of the Submarine contract is scandalous.
The corrupt conduct by Thales under investigation by the Senate is the rorting and rigging of a $1.5 billion contract with Airservices Australia who are a government body responsible for airspace management in Australia which includes the management of airport control towers etc.
The Australian Senate inquiry
The Australian Senate have been investigating financial fraud and corruption at Airservices Australia since 2014 which also involves Thales and its Australian CEO Chris Jenkins. The inquiry has heard evidence of widespread fraud, nepotism and blatant corruption.
The Senate inquiry was still in progress in 2016 and in 2015 they referred the matter of dodgy consultancy contracts to the Australian National Audit Office who investigate financial corruption on behalf of the government. It says on their website:
“Our purpose is to provide the Parliament with an independent assessment of selected areas of public administration, and assurance about public sector financial reporting, administration, and accountability. We do this primarily by conducting performance audits, financial statement audits, and assurance reviews.” (Click here to read more)
The National Audit Office were due to report in May 2016 and did publish recommendations that achieved very little. (Click here to read the recommendations)
The Airservices Australia multi-million-dollar consultancy sting
The big sting was a dodgy multi-million-dollar consultancy contract that was overseen by Airservices chairman Sir Angus Houston who is a former Chief of the Air Force and Chief of the Defence Force.
How the sting worked
Airservices Australia hired a consulting organisation called International Centre for Complex Project Management (ICCPM) to negotiate a $1.5 billion contract with Thales to upgrade Australia’s air traffic control program. The problem is that ICCPM is very dodgy to say the least. The former chairman and still a director of ICCPM is Thales CEO Chris Jenkins.
It should be no surprise that Thales was awarded the contract in February 2015 which is called the Onesky project. (Click here to read more)
It doesn’t get any more corrupt than this
So the net effect is that you have an organisation overseen by Chris Jenkins in his role as chairman/director (ICCPM) negotiating with Chris Jenkins in his role as CEO (Thales) to get the best deal for Airservices Australia.
Airservices Australia should have had nothing to do with ICCPM as they are in effect a division of Thales. Airservices should have had the expertise to negotiate themselves and if they didn’t they should have employed people directly with the experience. (Click here to read more)
I don’t have a copy of the Senate findings but from memory they did bugger all. Another reason why we need a Federal ICAC.
Scott Morrison and the David Gazard connection
Scott Morrison and David Gazard
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David Gazard is the man who Scott Morrison went to for advice during the leadership showdown between Tony Abbott and Malcolm Turnbull in September 2015. The SMH reported in 2016 in an article titled “Scott Morrison’s relentless rise to power“:
“On the evening of September 14, 2015 Tony Abbott’s prime ministership was hanging by a thread. Abbott had made Morrison a last-minute offer to join him on a leadership ticket and to take over Joe Hockey’s job as Treasurer. Hunkered down in his Parliament House office over a home-made curry, Morrison gamed his next move with his close friend David Gazard, a former Howard and Costello staffer, while Costello offered advice over the phone.“ (Click here to read more)
That shows that David Gazard is one of Scott Morrison’s closest advisors and friends if not his closest.
Update: A few minutes after publishing this article it was brought to my attention that another company called ECG Financial has the same 2 directors, David Gazard and Jonathan Epstein, as ECG Advisory Solutions. Also ECG Financial has a Chairman who is none other than former federal treasurer Peter Costello who is also mentioned above as the other person that Scott Morrison sought advice from in September 2015 during the leadership challenge. (Click here to see their website)
The ABC reported (11/2/19):
A long-awaited contract for the $50 billion Future Submarine program will be signed in Canberra today by France and Australia, following months of tough negotiations and the recruitment of a high-powered lobbyist.
The ABC can reveal one of Prime Minister Scott Morrison’s key political confidants was recently hired by the French state-owned shipbuilder Naval Group to help improve a rocky relationship with the Defence department, and to secure a crucial Strategic Partnering Agreement (SPA).
“ECG Advisory Solutions“, a lobbying firm founded by former Liberal party candidate David Gazard, has been advising Naval Group since last year on how to handle the difficult SPA negotiations with Australia.
Mr Gazard, who was chief of staff to former New South Wales Liberal leader John Brogden, began his friendship with Mr Morrison when he was the Liberal Party’s State Director for the 2003 election.
In a statement, Naval Group confirmed the arrangement but did not disclose how much Mr Gazard’s company was being paid for its lobbying services.
Mr Morrison discussed progress on the SPA with French President Emmanuel Macron at the G20 summit in late November, and told reporters they had agreed to elevate it “back up to leader-level to ensure it’s finalised in the near term”. (Click here to read more)
In December 2018 the Financial Review reported:
The other significant “mate of Morrison” who straddles the business and political worlds is David Gazard, a former staffer to Howard and Peter Costello turned lobbyist.
One Liberal source says Gazard is “number one” in terms of who Morrison talks to first but Gazard, who calls the PM one of his best friends, maintains he is way down the pecking order. (Click here to read more)
The $50 billion contract, and the direct involvement of Prime Minister Scott Morrison and his mate David Gazard’s has got the smell of the Malaysian bribery scandal all over it. Naval Group were having trouble finalising the details of the $50 billion deal with Australia so they hire Prime Minister Scott Morrison’s best mate as a “consultant” and pay him $millions to get the deal finalised.
How do I know David Gazard is getting paid $millions? I don’t. But former federal MP and trade minister Andrew Robb is being paid $880,000 a year, even if he does nothing, for a consulting deal with a company closely linked to the Chinese government. (Click here to read more) So it would be a fair guess that David Gazard is being paid $million if not more for “consulting” on the $50 billion submarine deal. The exact deal and how much David Gazard is being paid is something that Prime Minister Scott Morrison has an obligation make public. For Scott Morrison to say it has nothing to do with him is not believable. The French didn’t employ Morrison’s mate for nothing.
Naval Group has a long history of employing dodgy consultants to bribe government officials. And in November 2018 Prime Minister Scott Morrison decided the $50 billion deal would be finalised “back up to leader-level to ensure it’s finalised in the near term”. That is about the same time that David Gazard was hired by Navel Group. It raises many questions.
Did Scott Morison suggest to French President Emmanuel Macron that the French government-owned Naval Group should employ David Gazard and pay him $millions to finalise the $50 billion submarine contract? Should Australia trust any of them with our $50 billion? I don’t think so.
The scandal involving Morrison, his mate David Gazard and the $50 billion submarine contract should be front page news and the end of Morrison’s career as there are too many unaswered questions but once again the old media have failed to hold the government to account as you won’t read the above anywhere else.
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