tag:theconversation.com,2011:/id/topics/obeid-family-4686/articlesObeid family – The Conversation2013-07-31T02:59:18Ztag:theconversation.com,2011:article/165492013-07-31T02:59:18Z2013-07-31T02:59:18ZICAC calls for criminal charges against NSW ALP kingmakers: the experts respond<figure><img src="https://images.theconversation.com/files/28384/original/rpfz2dym-1375234165.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">ICAC has found Eddie Obeid (pictured at an earlier hearing), his son Moses and former NSW mining minister Ian Macdonald engaged in corrupt conduct.</span> <span class="attribution"><span class="source">AAP Image/Paul Miller</span></span></figcaption></figure><p>The NSW Independent Commission Against Corruption (ICAC) today found NSW Labor powerbrokers Ian Macdonald and Eddie Obeid, and his son Moses Obeid, engaged in corrupt conduct and has recommended criminal charges against them.</p>
<p>The trio, who have denied all allegations, now have the opportunity to seek judicial review of the findings. ICAC has referred their findings to the Director of Public Prosecutions (DPP).</p>
<p>The investigation has sparked calls for reform of the powerful NSW ALP branch.</p>
<p>The findings are part of <a href="http://www.icac.nsw.gov.au/investigations/current-investigations/investigationdetail/192">three operations</a>.</p>
<p>Operation Jasper centred on the circumstances surrounding a decision made in 2008 by Macdonald, who was NSW Minister for Mineral Resources at the time, to open a mining area in the Bylong Valley for coal exploration, including whether the decision was influenced by Eddie Obeid. Prosecutors alleged the Obeids, who bought property in the region just before the area was opened for mining, stood to gain tens of millions of dollars from the decision.</p>
<p>Operation Jarilo concerns allegations that ex-boxer Fortunato (Lucky) Gattellari and businessman Ronald Medich offered rewards (including the services of a prostitute) to Macdonald in exchange for meetings with NSW energy executives.</p>
<p>Operation Indus investigated the circumstances in which Eddie Obeid’s son Moses provided former NSW Roads minister Eric Roozendaal with a vehicle in 2007. ICAC cleared Roozendaal of any wrongdoing.</p>
<p>Eddie Obeid has <a href="https://twitter.com/SeanNic/status/362385584448237568/photo/1">denied</a> any allegations of wrongdoing, saying that he “reject[s] the assertions by the Commissioner that I acted in any way that could amount to corrupt conduct”. </p>
<p>Here are some expert responses to the findings:</p>
<p><strong>Mark Rolfe, Lecturer, School of Social Sciences and International Studies at the University of New South Wales</strong></p>
<p>The recommendations for prosecution are hardly surprising given the newspaper coverage of the ICAC inquiry over many months now. The front page of the Sydney Morning Herald yesterday foreshadowed such recommendations.</p>
<p>It’s interesting that Roozendaal was cleared because he was obviously caught up in the whole media furore over this time. In that respect, it keeps the focus on Macdonald and on the Obeids.</p>
<p>It allows John Robertson, the leader of the NSW Labor party, to claim they have dealt with the few bad apples by expelling them from the party and by embarking on reforms of the party that empower members to have a say in the choosing of the candidates. In this respect, Robertson is riding the coat tails of Kevin Rudd, who has been distancing himself from the NSW branch, which he has been able to associate with the faceless men that brought him down three years ago.</p>
<p>Real reform is starting. There were a number of things recommended in the Bracks, Carr and Faulkner report on party reform, such as alliances with progressive organisations on the Left that could be further implemented. Those three men realise that the old days of the mass party membership are over and many people are invigorated in politics by organisation outside of major parties, such as Get Up.</p>
<p>Some of these reforms are happening or in the pipeline and are attempts at reform that appear more in touch with the community. But it’ll be interesting to see how these things play out in the future. Much still hangs in the balance there.</p>
<hr>
<p><strong>Anika Gauja, Lecturer, Department of Government and International Relations, University of Sydney</strong></p>
<p>The Labor party pre-empted ICAC’s findings by <a href="http://www.news.com.au/breaking-news/national/nsw-labor-placed-under-administration/story-e6frfku9-1226674011553">intervening</a> in the NSW branch earlier this month to amend the party’s rules.</p>
<p>Although the new rules are yet to be finalised by the National Executive (they meet on Thursday), what has so far been announced attempts to address the issue of undue influence in three main ways: by removing the prohibition against disgruntled members taking their grievances to the courts, the creation of more explicit rules to remove and suspend members alleged to have engaged in corrupt activity and the creation of an independent party body to adjudicate intra-party disputes.</p>
<p>Plans have also been made to allow members to directly elect 50% of the party’s powerful administrative committee. The reforms essentially try to diminish the power of organised interests such as factions and the unions by individualising more party decision-making processes - in this instance giving individual rank and file members a say over the election of more party officials.</p>
<p>While allowing members a greater say is a step forward in bolstering the party’s image as a grassroots organisation serious about public participation and engagement and participation ahead of the election, these sorts of measures will never entirely prevent individuals and groups organising and finding ways to exert influence through party structures.</p>
<p>This is a problem for all parties, not just Labor, and permeates well into parliamentary politics - particularly if a party is in power. In this sense, ICAC’s findings can’t be addressed by internal Labor party reform alone.</p>
<p>Allowing members to take the party to court is an interesting reform (removing a prohibition that has been in place for decades), but the costs associated with taking the party to court would be well out of the reach of most members. This change, in combination with the implementation of an independent review panel, will increase transparency within the party.</p>
<p>The flip side is that more of the party’s “dirty laundry” will be aired in public.</p>
<hr>
<p><strong>Olivia Monaghan, PhD student researching anti-corruption efforts in the School of Social and Political Sciences at the University of Melbourne</strong></p>
<p>The significance of today’s ICAC findings reaches beyond NSW state borders. Following an exhaustive anti-corruption “clean up” in the 1990s, NSW has been widely regarded as the model state for anti-corruption success.</p>
<p>Indeed, many of the other Australian states have based their anti-corruption organisations on the structure and functionalities of the NSW ICAC.</p>
<p>This initial success, however, was achieved through designing anti-corruption methods that focused on the corrupt culture that had been allowed to foster within the NSW public service (most notably within the police force).</p>
<p>If anything, today’s findings – the result of extensive, time consuming investigations – demonstrate the importance of ongoing scrutiny of cultural practices.</p>
<p>While the faces and places of today’s findings were based in NSW, the cancerous nature of both cultural practices and corruption serve as a reminder to other Australian states that, where wealth and power co-exist, corruption can flourish.</p>
<p>A robust relationship between the ICAC and DPP is needed to ensure both the success of anti-corruption efforts, and the punitive deterrents to corrupt conduct.</p>
<p>The ICAC doesn’t have recourse to make criminal charges or recommend specific charges. What the ICAC does is puts together the body of evidence and determines that what has been done can be deemed corrupt. That gets passed onto the DPP and then it’s up to the DPP to lay individual charges.</p>
<p>In NSW, we will probably see criminal charges made in the next month. They could be charged with fraud, misconduct in public office or bribery.</p>
<p>Those sorts of charges have been successfully brought to court in the past.</p>
<p>The penalties vary on the severity of the crime, from heavy fines to jail time or a combination of the two. </p><img src="https://counter.theconversation.com/content/16549/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The NSW Independent Commission Against Corruption (ICAC) today found NSW Labor powerbrokers Ian Macdonald and Eddie Obeid, and his son Moses Obeid, engaged in corrupt conduct and has recommended criminal…Mark Rolfe, Lecturer, School of Social Sciences, UNSW SydneyAnika Gauja, Lecturer, University of SydneyOlivia Monaghan, PhD student in the School of Social and Political Sciences, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/123112013-03-12T03:24:13Z2013-03-12T03:24:13ZTime for policymakers to address tax benefits from family trusts<figure><img src="https://images.theconversation.com/files/21126/original/qswyzrts-1363043252.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Tax benefits have made family trusts an increasingly popular financial arrangement.</span> <span class="attribution"><span class="source">Image from www.shutterstock.com</span></span></figcaption></figure><p>Family trusts have featured heavily as part of recent media reporting of the circumstances of two very high-profile families: the <a href="http://www.abc.net.au/news/2012-11-07/rinehart27s-family-trust-battle-enters-another-year/4358452">Rineharts</a> and the <a href="http://www.abc.net.au/news/2013-02-05/obeid-27cannot-recall27-getting-family-trust-money/4501366">Obeids</a>. Of course, these are not the only families that have a family trust as part of their financial arrangements. In recent times, the growth in the use of family trusts far outstrips the growth in the use of partnerships and companies (and sole traders). All four of these “vehicles” are used in family settings.</p>
<p>Most families with a substantial asset or assets or a business will act on advice from professionals. Accordingly, it is very unlikely that the faster rate of growth in the use of family trusts is the result of uninformed decision-making. (Nearly all family trusts are <a href="https://theconversation.com/beware-the-pitfalls-of-the-discretionary-family-trust-11224">discretionary trusts</a>.) There is no systematic data on what is motivating families to prefer using family trusts. But, from even a quick glance at a small number of cases that have come before the tax tribunals, it is very clear that tax considerations feature very heavily in the choice of vehicle.</p>
<p>What is it about family trusts that makes them so attractive from a tax perspective? The short answer: the family tax liability is very likely to be lower when the family uses a family trust compared to the use of the sole trader, partnership or company. Why is this the case?</p>
<p>The central point is that with a family trust, the collective taxable income of the trust for a year can be allocated to family members (beneficiaries) so that the taxable income attracts the lowest rate(s) of tax possible. This is done by allocating income to family members who have the lowest income from other sources (e.g. 19-year old full-time university student, a stay-at-home spouse). After allocating the income tax “efficiently” to use up family members’ tax-free thresholds and low rate bands up to around 30%, any remaining income is often allocated to a family company (a so-called “bucket company”). The rate of tax for companies is capped at 30% and there is no Medicare levy.</p>
<p>The added advantage is that the allocation for one year does not lock in any allocations for subsequent years. This means that for a subsequent year, if a family member’s income profile changes, this can be taken into account in making the allocations for that subsequent year (e.g. a lower allocation to an over 18-year old, who now has a full-time salary; a higher allocation to family member who has lost their job). It should also be noted that these income allocations are valid for tax purposes even though the relevant family member has no entitlement to the capital that produced the income.</p>
<p>Another advantage of the family trust is that categories of gains that have a certain tax character or tax benefits attached (franked dividends, discount capital gains) can be “streamed” after the gain is made by the trust to family members that can make best use of the tax character of the gain or tax benefits attached by allocating a capital gain to a family member that has a personal capital loss so that the gain is protected from tax by the personal loss.</p>
<p>In short, the numerous advantages set out above are not available in the sole trader, partnership or company situation. Why not? These other vehicles simply are not flexible enough so that income allocations must be made in line with ownership interests in the vehicle. Where these other vehicles seek to replicate the flexibility of the family trust, the tax law will usually trigger a capital gains tax charge because a change in income allocations is usually accompanied by a change in ownership rights. Further, replicating the family trust’s flexibility will also usually be met with at least one anti-avoidance measure.</p>
<p>Defenders of the current system often say that a family trust is a trust which is recognised by the courts and part of that recognition is the flexibility of this trust. That is true. But, the tax law does not automatically accept (or blindly follow) the non-tax law position of a transaction. Further, defenders of the current position say the tax treatment of family trusts is simply taxing the beneficiary that obtains the money (i.e. tax liability follows the money). But our Tax Act does not simply follow the money. If it did, our Tax Act would be taxing people on receipt of gifts and giving deductions for gifts made. There is generally no rule in our Tax Act that taxes the recipient of a gift. But, this is exactly what the tax law is doing in regard to a beneficiary of a family trust; the beneficiary is getting a gift from the trust and the Tax Act is taxing that person on receipt of the gift. To say this is out of step with a fundamental principle of our income tax system would be a massive understatement.</p>
<p>Defenders of the current system also often assert that they use their family trust for asset protection purposes and for retaining assets in the family. This can be accepted. But, addressing the tax inequity need not undermine the use of family trusts for such purposes. The tax law is often amended to address tax anomalies (tax inequity), without changing the commercial position of the tax-reformed area.</p>
<p>Addressing unfairness or anomalies in our tax system is often a difficult task. Vested interests have and will continue to stand in the way of reform. But the use of family trusts has become so pervasive that even families with modest business or property assets (around $350,000) can gain a tax benefit from their use. This, perhaps along with an “aspirational” element that accompanies trusts, may explain the general reluctance of policymakers to take a serious look at scaling back the tax advantages from family trusts.</p><img src="https://counter.theconversation.com/content/12311/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Dale Boccabella does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Family trusts have featured heavily as part of recent media reporting of the circumstances of two very high-profile families: the Rineharts and the Obeids. Of course, these are not the only families that…Dale Boccabella, Associate Professor of Taxation Law, Australian School of Business, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/118912013-02-07T00:18:36Z2013-02-07T00:18:36ZICAC, Obeid and the danger of exploiting public disgust<figure><img src="https://images.theconversation.com/files/19992/original/k5rsyqbd-1360116268.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Moses Obeid, the son of former Labor MP Eddie Obeid, leaves the Independent Commission Against Corruption (ICAC) in Sydney.</span> <span class="attribution"><span class="source">Dean Lewins/AAP</span></span></figcaption></figure><p>After hearing <a href="http://www.abc.net.au/news/2013-02-01/pressure-increases-on-moses-obeid/4496890">recent evidence to the Independent Commission Against Corruption</a>, I find this line too good to resist: “Moses Fingers Jesus as Culprit in Mining Maps”. </p>
<p>I refer, of course, to Moses Obeid, son of Eddie the ex-NSW MP and much respected pillar of our community who is currently appearing before ICAC with its enquiries. <a href="http://www.abc.net.au/news/2013-02-01/jesus-may-have-drawn-mining-maps-says-moses-obeid/4495566">He referred the counsel assisting to a certain Nazarene</a> when asked why there were pencil marks on mining maps that should not have been out of the Department of Mineral Resources, let alone in the offices of the Obeids where they were found after a raid.</p>
<p>This family is now under investigation for allegedly acquiring a few pittances <a href="http://news.smh.com.au/breaking-news-national/obeid-had-early-access-to-mining-data-20121114-29blm.html">from insider knowledge about mining leases</a> issued by the state government that led them to buy up land in the Bylong Valley. <a href="http://www.afr.com/p/national/coal_licences_corrupt_deal_worth_5N2rJf47NdL2yQJuDxmmkJ">The few pittances seem to be in the range of $60 to 100 million</a> and ICAC is intent on questioning the relevant minister of the time, Ian McDonald, who seems to have received great affection from <a href="http://www.abc.net.au/worldtoday/content/2013/s3683361.htm">hundreds of phone calls</a> in one year from the Obeids.</p>
<p>To continue the religious line, I’m sure Premier Barry O’Farrell is thanking God each night and thinking She votes Liberal. Probably, Tony Abbott is as well. After all, the latter has been banging on <a href="http://www.theaustralian.com.au/national-affairs/abbott-says-gillard-controlled-by-labor-party-machine/story-fn59niix-1225900017216">since 2010 about the “faceless” men</a> (I’m sure I know what Mark Arbib looks like) who dominate the NSW branch of the Labor Party and deposed Kevin Rudd, thus exporting the <a href="http://news.smh.com.au/breaking-news-national/carr-will-bring-nsw-disease-abbott-says-20120302-1u7l0.html">“NSW disease”</a> to federal politics. That is, “our Kev” went into a revolving door and came out as “that Julia”, just as Morris Iemma, Nathan Rees and Kristina Keneally twirled through as Premiers of this great state.</p>
<p>It’s been a potent line, even if it was slippery with the facts. Nevertheless, the link between these successive political casualties is the aforementioned Eddie, once the formidable party powerbroker and leader with Joe Tripodi of the <a href="http://www.smh.com.au/news/opinion/nsw-labor-finds-itself-in-a-terrigal-spin/2005/08/28/1125167548366.html">“Terrigals”</a> faction which dominated the Right faction of the parliamentary Labor Party and so dominated the rest of the party in the NSW parliament. Thus, Bob Carr was more <a href="http://en.wikipedia.org/wiki/Hogan's_Heroes#Sergeant_Schultz">Sergeant Schultz</a> than premier in this squalid scenario.</p>
<p>Transport, health and other infrastructure were boiling concerns for voters but after <a href="http://www.smh.com.au/news/national/lightning-strike-asbr-iemma-forced-to-go/2008/09/05/1220121483704.html">Iemma was deposed</a> they were left with the impression of a party not only disappearing up its own fundament but only concerned with itself.</p>
<p>For example, ICAC and Eddie are old acquaintances, if not BFFs. He appeared before ICAC in 2002 over allegations of a $1 million donation to the party for a development project in <a href="http://www.abc.net.au/stateline/nsw/content/2002/s744085.htm">Liverpool</a>.</p>
<p>Consequently, according to election analyst Antony <a href="http://blogs.abc.net.au/antonygreen/2011/06/a-few-statistical-notes-on-the-nsw-election.html">Green</a>, the 2011 state election was a “pretty devastating result for the NSW Labor Party”. Although a lot of rubbish has been uttered in the past about traditional Labor battlers deserting the party for the Coalition (see this <a href="https://www.adelaide.edu.au/apsa/docs_papers/Aust%20Pol/Brent.pdf">paper</a> for a sensible rejoinder), Green stated “The Liberal Party even won a majority of the vote in Western Sydney, a first preference vote of 43.5% to 36.6% for Labor, a Liberal two-party vote of 53.8%”. The Coalition were also outpolling Labor in heartlands like the lower Hunter, such as Newcastle. More than a year later, the local elections of 2012 reinforced this trend.</p>
<p>Now, in 2013, a similar picture of NSW has emerged federally. One <a href="http://jwsresearch.com/wp-content/uploads/2013/01/Federal-Marginals-Poll-January-20132.pdf">poll</a> of 54 marginal seats show the ALP on 45.1% and the Coalition on 54.9% on two party preferred basis. This is in the realm of other polls. Significantly, it predicts a loss of more than ten seats in this state with double digit swings bashing Labor.</p>
<p>In other words, the election of the O’Farrell ministry did not lance the electoral poison in the hearts of many voters towards Labor. Usually, the animus moves on, as happened in <a href="http://www.news.com.au/national-old/julia-gillards-party-is-just-about-over-as-labor-routed-in-queensland/story-e6frfkvr-1226309867779">Queensland after the political tsunami that hit Anna Bligh</a> and left her party small enough to fit in the parliamentary bathroom.</p>
<p>If nothing else, Obeid’s appearances before ICAC in 2002 and 2013 demonstrate how different the Labor Party was from the beast of old. As much as Abbott likes to claim the “NSW disease” is the problem there is another. Since the 1990s, the constant complaint has been about the empty heart of the party, the vacuum of beliefs, the failure of anybody to know what it stands for. </p>
<p>Obeid is more symptomatic of a greater problem. He rose to power, wealth and parliament in the era after the Hawke government dismantled many of the old beliefs. The party has been left without an ideological compass, meanwhile, the careerists moved up the political and economic ladder without a worry.</p>
<p>All this provides a delicious opportunity for Barry O’Farrell. He can relish the constant drip of revelations between now and federal election day and enjoy the slow roasting of Labor. With a straight face, he can front the cameras on the rooting out of all that is naughty and not nice to voters and portray his own side as up holders of the public good.</p>
<p>Of course, his memory will remind him to avoid blowback to this own side. In the late 1980s, Nick Greiner capitalised on perceptions of Labor corruption to become premier and then set up ICAC. However, <a href="http://www.smh.com.au/nsw/no-fish-too-small-says-greiner-in-defence-of-icac-20101208-18pxf.html">the new body later concluded he was corrupt in an offer of a public service job</a>, although the courts threw this out. But the whole thing damaged the Coalition and lay dormant in its recesses for a long time.</p>
<p>O'Farrell will also remember the <a href="http://www.cmc.qld.gov.au/about-us/our-organisation/our-background/fitzgerald-inquiry">Fitzgerald inquiry</a> launched in Queensland in 1987. This was set up by the acting premier while Joh Bjelke-Petersen was out of the state in response to an ABC Four Corners expose of corruption of politicians and police. It not only caused the downfall of Joh and the gaoling of three former Coalition ministers and a police commissioner but also initiated a major overhaul of the political system. Fitzgerald wanted to establish structures and procedures that would improve accountability and reduce the possibilities of swapping of favours and political donations.</p>
<p>Like O’Farrell and Greiner, Labor leader Wayne Goss rode into power on a wave of revulsion at political corruption and a promise to clean things up by implementing the Fitzgerald Report. Consequently, the <a href="http://www.cmc.qld.gov.au/about-us/our-organisation/fast-facts">Criminal Justice Commission</a> was established to oversee political and bureaucratic behaviour. Parliamentary committees were bolstered. An independent electoral commission was set up to ensure fairness and to eradicate the <a href="http://elections.uwa.edu.au/glossaryc.lasso?CondensedGlossary=malapportionment">malapportionment</a> and <a href="http://elections.uwa.edu.au/glossaryc.lasso?CondensedGlossary=gerrymander">gerrymandering</a> that buttressed Joh. In other words, Queensland finally entered the late twentieth century of parliamentary government and democratic accountability.</p>
<p>Nothing is so good for a politician as riding the popular waves of disgust at the game of politics. That’s what Wayne, Nick and Barry found. But nothing so ambitious as the Fitzgerald Report is wanted by Barry for fear of blowback on his side and losing the political advantage he currently enjoys. </p>
<p>In fact, he will press home the advantage with <a href="http://www.theaustralian.com.au/national-affairs/state-politics/ofarrell-locks-out-unions-on-campaign-funds/story-e6frgczx-1226272139270">changes to political donations to cut off the ALP from union funding</a>, all under the guise of fairness. And enjoy the reality TV program called ICAC.</p><img src="https://counter.theconversation.com/content/11891/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Mark Rolfe does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>After hearing recent evidence to the Independent Commission Against Corruption, I find this line too good to resist: “Moses Fingers Jesus as Culprit in Mining Maps”. I refer, of course, to Moses Obeid…Mark Rolfe, Lecturer, School of Social Sciences, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/118962013-02-01T03:27:35Z2013-02-01T03:27:35ZKeeping up with the Obeids: the media and corruption claims in Australia<figure><img src="https://images.theconversation.com/files/19754/original/rskd78vz-1359619000.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">There has been a media frenzy around allegations against Moses Obeid (centre) and his family at ICAC. But he’s not alone.</span> <span class="attribution"><span class="source">AAP/Tracey Nearmy</span></span></figcaption></figure><p>When the Obeid family took the stand at the New South Wales Independent Commission Against Corruption (ICAC) yesterday, the Australian media took more notice than it previously had.</p>
<p>This is perhaps not surprising, considering the notoriety of the Obeids in New South Wales. Former state Labor MP and patriarch Eddie Obeid (senior) has a reputation as a right faction powerbroker within the ALP, due largely to his influential role in selecting the <a href="http://www.smh.com.au/nsw/moses-obeid-tells-icac-how-family-stood-to-benefit-from-ministers-decisions-20130131-2dmdk.html">past three New South Wales ALP Premiers</a>.</p>
<p>But politics is not the only calling for the Obeids. Eddie Senior, his wife Judith, and five business partner sons, Moses, Paul, Gerard, Damien, and Eddie Junior, also have stakes in industries such as mining, construction and exports.</p>
<p>Yesterday, the Obeids faced ICAC upon allegations of insider trading. The accusation is that they misused information provided by former state Minister for Resources, Ian Macdonald, to turn $200,000 worth of investments into an estimated $100 million profit.</p>
<p>This was allegedly achieved through the buying (and subsequent selling) of property in the Upper Hunter region of NSW prior to Macdonald granting leases to mining companies to allow exploration for coal in the area. Moses Obeid <a href="http://www.theaustralian.com.au/news/nation/obeid-talked-mining-deal-with-minister/story-e6frg6nf-1226565792862">has admitted</a> to acting as a “point of contact” between Macdonald and the rest of the Obeid family, with Macdonald providing Moses with a list of names of miners interested in investing in the region.</p>
<p>The Obeids did not just stand to benefit from selling property in the region. One of the mining companies that bought into the Upper Hunter after Macdonald’s tendering of leases – Cascade Coal – is <a href="http://www.abc.net.au/am/content/2013/s3679928.htm">25% owned by the Obeids</a>.</p>
<p>Due to the high monetary value of the alleged offence and the high profile of the Obeid family in New South Wales, it is not entirely surprising that this case has caught the media’s eye.</p>
<p>When considering the history of corruption in Australia, however, how bad are the Obeid allegations really?</p>
<p>A perception seems to exist that Australia has been “cleaned up” following the corruption scandals of the 1980s and 1990s such as the <a href="http://www.icac.nsw.gov.au/dmdocuments/pub2_22i1.pdf">Greiner dismissal</a> and Queensland’s <a href="http://www.cmc.qld.gov.au/about-us/our-organisation/our-background/fitzgerald-inquiry">Fitzgerald Inquiry</a>. The idea goes that the numerous inquiries into political and police corruption have effectively changed national attitudes towards corruption and misconduct. If the allegations being investigated in the Obeid/Macdonald case are made out, Australia isn’t as clean as people think.</p>
<p>Corruption is defined by <a href="http://www.transparency.org/whoweare/organisation/faqs_on_corruption#defineCorruption">international organisations and academics alike</a> as the misuse of public office for private gain. In December of last year, <a href="http://www.theage.com.au/victoria/questions-on-geoff-shaw-fundraiser-20121219-2bnef.html">Victorian MP Geoff Shaw</a> was found to be a key figure in a “cash for access” scheme, in which Liberal Party funds were generated through payments made by property developers and business figures to gain access to MPs at private events. In the same month, allegations about New South Wales Customs hit the media, in which <a href="http://www.abc.net.au/news/2012-12-21/customs-corruption-extends-to-waterfront/4439178">customs officials</a> have allegedly been using their position to import and traffic drugs, tobacco and weapons.</p>
<p>So that’s two examples from the past two months. If you extend the search parameter beyond eight weeks, more cases emerge.</p>
<p>In order for anti-corruption efforts to be successful, there needs to be a greater awareness of what corruption actually means.</p>
<p>But we also must be clear on what does not constitute corruption.</p>
<p>Taking the above examples, the alleged acts by New South Wales customs officials and Geoff Shaw, are clear examples of corruption. </p>
<p>Similarly, as the Obeid/Macdonald case relates to alleged events occurring when both men were in office, there is scope for their actions to be classified as corruption – but with evidence yet to be heard and the case still underway, this is yet to be determined. </p>
<p>Earlier this month, much attention was given in Victoria to the case involving the wife of state opposition leader Daniel Andrews and her involvement in a car crash, after which <a href="http://www.heraldsun.com.au/news/law-order/police-launch-investigation-into-why-labor-leader-daniel-andrews-wife-was-not-breathalysed-after-crash/story-fnat79vb-1226554714157">she was not breathalysed</a>. </p>
<p>With no evidence found to suggest that either Andrews or his wife used their position to force police to ignore procedure, this cannot be said to constitute corruption. In which case it’s worth asking whether the incident was deserving of the <a href="http://www.heraldsun.com.au/opinion/andrews-should-have-told-us/story-e6frfhqf-1226554705372">five-page spread</a> it received in the Herald Sun.</p>
<p>The Obeid case is sensational in its nature, but not alone in existence. Corruption in Australia is more widespread than you might think. What is important is how it is reported, and how anti-corruption policy is shaped. Media accountability does not fall into the shadows here. More scrutiny must be given to politicians and public officials, but greater accuracy is needed when it comes to understanding corruption. </p>
<p>The Obeid/Macdonald case presents a significant opportunity to ICAC. While it does not act as a prosecutorial body (rather it hears cases then passes the evidence on to prosecutors and parliament), with the national media coverage this case is attracting, the commission is able to draw attention to the importance of effective anti-corruption policy in Australia. </p>
<p>ICAC should use its media time wisely, to ensure it can fight future corruption cases that don’t sell quite so many newspapers.</p><img src="https://counter.theconversation.com/content/11896/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Olivia Monaghan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>When the Obeid family took the stand at the New South Wales Independent Commission Against Corruption (ICAC) yesterday, the Australian media took more notice than it previously had. This is perhaps not…Olivia Monaghan, PhD student in the School of Social and Political Sciences, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.