Former New South Wales Labor boss Jamie Clements was seen with an Aldi bag filled with $100,000 in cash after meeting Chinese billionaire and banned donor, Huang Xiangmo, the state’s anti-corruption body has heard.
The Independent Commission Against Corruption on Monday began its inquiry into a complex and potentially unlawful donations scheme that the commission has heard may have helped to hide a $100,000 donation from Huang, whose associations with property development prohibit him from giving money to political parties.
The inquiry heard on Monday afternoon that Huang had visited Labor’s Sussex Street headquarters in April 2015, more than three weeks after a Chinese Friends of Labor fundraising dinner in Sydney. That dinner was purported to have raised $100,000 in cash from 12 donors, but Icac is investigating whether they were so-called “straw donors” or fake donors, used to mask the true source of funds.
Labor’s then community relations director, Kenrick Cheah, said on Monday that he knew of Huang’s impending visit, but believed Huang was in “agriculture”, not property development. Internal emails show Cheah knew Huang was a major political donor. Cheah said he didn’t thoroughly investigate his background, but knew he was important.
“I would say that anyone who is rich is important,” Cheah said.
He watched Huang arrive at Labor HQ and go to meet with Clements, but could not recall whether Huang was carrying anything.
A short time later, Clements came out of his office and handed him an Aldi bag, Cheah said. He said the bag was filled with stacks of $100 notes wrapped in elastic bands. Cheah remembers Clements telling him: “Here is some donation money and forms. Check the forms. If it is all OK, then give it to finance.”
The forms were reservations for the earlier Chinese Friends of Labor fundraising dinner. Cheah said there were about 20 separate forms from different donors. He began counting the money by hand, but then took the rest of the money home with him overnight, because “it was more risky keeping it in the office”.
The Icac chief commissioner, Peter Hall, asked Cheah why Huang would bring in a shopping bag full of money.
“If the cash came from multiple donors, can you explain to me, why Huang Xiangmo, said to be an extremely wealthy individual, would be carrying cash in a shopping bag on behalf of donors? Can you explain that to me?” Hall asked.
“Why would a man of his stature be undertaking such a task of a delivery man?
Cheah said he supposed that Huang had wanted to appear like “the big man” who could bring in so much money.
“I guess to people like him, it gives him face by being the one to bring this amount of donations from X people and give it to Jamie himself,” Cheah said. “It’s a concept of face. He feels like ‘I’m the big man, who can organise this for you’.”
Earlier on Monday, the inquiry began with explosive evidence that one of the Chinese property developers suspected of having links to the scheme, Quanbao “Leo” Liao, of the firm Wu International, took his life before he could give evidence to investigators last year. In his suicide note, Liao told his family he had been visited by detectives.
“I have decided to leave this world, which is also my last hardest attempt, to prevent you and our daughter from becoming family members of a criminal. This is because I am still innocent at the time I wrote this letter,” he wrote in a translated letter.
The scheme to avoid NSW donations laws allegedly operated from 2015, and the commission is investigating whether it involved NSW Labor officials and prominent Chinese donors, including Huang, who was blocked from re-entering Australia last year following advice from security agencies.
The Chinese Friends of Labor fundraising dinner at the centre of the inquiry was attended by former federal and NSW opposition leaders Bill Shorten and Luke Foley. There is no suggestion Shorten or Foley were involved in any misconduct.
Labor recorded receiving a total of $138,000 in revenue, including $100,000 in cash, donated by 12 donors in bite-sized chunks that remained just below NSW’s maximum donation cap. The money was a significant boost to Labor just before the 2015 state election.
Subsequent investigations found the majority of the 12 declared donors were all linked to Jonathan Yee, the general manager of Sydney Emperor’s Garden Restaurant, through his family or business. Yee also held a senior role with the Chinese Friends of Labor group.
Explosive evidence has already been given to Icac by Kaila Murnain, the current NSW Labor general secretary, who was an assistant secretary of Chinese Friends of Labor in 2015. She has told Icac that the former Labor state MP Ernest Wong had told her Huang was the true source of the $100,000.
“Of course, Ms Murnain’s statement as to what Mr Wong is said to have told her is not, of itself, conclusive proof that there were one or more ‘straw donors’ or ‘pretend donors’ associated with the Chinese Friends of Labor function in 2015 or that there was a scheme to conceal the fact that Mr Huang was the true source of funds,” Icac counsel assisting, Scott Robertson, told the inquiry.
“I anticipate though, that other evidence bearing on that issue will be presented during the course of this public inquiry.”
The alleged crimes Icac are investigating are punishable by up to two years’ imprisonment in most cases, and, in one case, up to 10 years.
Icac began a full investigation, codenamed Operation Aero, in June, after a preliminary inquiry determined there was “evidence or reliable information to suggest the occurrence of the conduct referred”.
Late last year, about 10 officers descended on the NSW Labor headquarters with a search warrant, attracting widespread media attention. The timing of the raid, three months before the state election, angered the party, which complained that the matter had already been investigated comprehensively by the NSW electoral commission.
Hall, the chief commissioner, is presiding over the hearing, which has been set down for six weeks. Murnain and Wong are expected to give evidence.
The former Labor senator Sam Dastyari is also scheduled to give evidence. Dastyari sensationally quit parliament in 2017 after revelations of his links to Chinese donors, including Huang.
In Australia, the crisis support service Lifeline is 13 11 14; Kids Helpline 1800 55 1800; Beyond Blue 1300 22 4636. In the US, the National Suicide Prevention Lifeline is 1-800-273-8255. In the UK, Samaritans can be contacted on 116 123.
