Former NSW government ministers Ian Macdonald and Eddie Obeid have been found guilty of conspiring in a scheme over a mining exploration licence that resulted in a $30 million windfall for the Obeid family.
The pair, who spent two decades as Labor MLCs, and Obeid’s son Moses were convicted on Monday of conspiring to commit misconduct in public office following a marathon trial before Justice Elizabeth Fullerton in the NSW Supreme Court.
The trial centred on the 2009 granting of a coal exploration licence at Mount Penny in the Bylong Valley, the area of which encompassed a large property called Cherrydale Park owned by the Obeids.
The crown alleged the trio had agreed Macdonald, then the mineral resources minister, would “do what he could, if and when the opportunity presented” when it came to the coal exploration licence at Mount Penny and the Obeid’s financial interests.
Justice Fullerton found Macdonald committed five acts of public misconduct in his ministerial role, including asking the department he controlled for information about coal reserves and the licence, and giving departmental documents to Eddie and Moses Obeid or their family members.
Moses Obeid vigorously negotiated for a deal with two companies, Monaro Mining and Cascade Coal, that made bids for the licence under the department’s closed tender process, the court heard.
His pursuit of a joint venture was successful and the Obeids entered into an agreement with Cascade Coal, which was granted the licence in October 2009.
A year later, the Obeids sold their interest in this venture for $60 million, with half that sum paid into various family-owned and associated companies.
There was also more than $1 million paid in access fees to Cherrydale Park and two other properties, owned by Obeid associates, within the bounds of the exploration licence.
Justice Fullerton found Macdonald had breached his ministerial duties of impartiality and confidentiality and that his role in the conspiracy was laid bare by his proven acts of misconduct.
She found Moses Obeid’s efforts to “maximise” the financial benefit of Macdonald’s misdeeds — including in his pursuit of a deal with the mining companies — as well as lies he told to journalists was evidence of his participation.
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And the judge said she could not countenance a reasonable possibility that Macdonald and Moses Obeid would have executed such a conspiracy, from May 2008 through to January 2009, without Eddie Obeid’s participation.
It was “implausible” Macdonald would have strongly suggested to his department that they redraw a new coal exploration area encompassing Cherrydale Park without Eddie Obeid’s express knowledge, she said.
Justice Fullerton found the misconduct was so serious that it warranted criminal sanction.
The people of NSW were entitled to expect ministers would act “at all times conscientiously and honestly in the public interest”, she said.
Justice Fullerton declared each of the men guilty on Monday after reading aloud a summary of her lengthy judgment.
All three accused learned their fate over video link — Eddie and Moses Obeid dropping out at one point — due to the Sydney outbreak of Covid-19.
The three men, all on bail, will return to court for detention applications on Thursday.