Big business: Andrew McManus in his office. Photo: Teagan Glenane FCN
Controversial music promoter Andrew McManus has unwittingly revealed an important career lesson to tax evaders: if you are going to boast about ripping off the Australian Tax Office, don’t confide in the police.
His bizarre admission emerged last week in a court case involving the promoter, a bag full of cash, international rock acts including Fleetwood Mac and Lenny Kravitz and crime figures from Australia and the US.
“I’m not a dickhead but… if this went to the ATO, I’d be cooked again.”
During an investigation into the source of the $702,000 cash found in a Sydney hotel room in 2011, McManus claimed the money was his. He boasted to police if they came round to his house “right now” they would find a safe with “600 large sittin’ in it”.
Legends: International rock act Fleetwood Mac.
When the police asked about the source of the money, he said, “This isn’t going anywhere?” He then offered that the “600 large” came from a Lenny Kravitz tour.
He told police that he used 20 crew members to “sneak” the cash in from New Zealand.
“I’m not a dickhead but… if this went to the ATO, I’d be cooked again,” he volunteered.
Legal fight: Sean Carolan at the Supreme Court in Sydney. Photo: Photo: Janie Barrett
Documents tendered during a recent battle in the NSW Supreme Court over the money have revealed that McManus also accepted $450,000 in cash from the outlaw Perth bikie gang, the Coffin Cheaters.
He also admitted to police that he withheld funds from rock groups including international stars Fleetwood Mac.
McManus also confided to police about the financial fallout from his involvement in the Melbourne Storm salary cap scandal.
The saga of the suitcase full of cash had its origins in May 2011 when McManus was staying at the luxurious InterContinental hotel in Macquarie Street, a short walk from Sydney’s Circular Quay.
In his hotel room he had a number of plastic shopping bags crammed with $10,000 bundles of cash totalling $702,000. His long-time friend and associate Craig Haeusler emptied the bags into a suitcase.
Haeusler, a drug kingpin who served five years in jail for running a multi-million dollar drug ring supplying methamphetamines to Sydney’s eastern suburbs, then gave the money to a young American, Owen Hanson jnr.
Haeusler told police he had been introduced to Hanson by a Chinese gambling identity and that the pair had bet on the NFL in America.
Hanson, who moved hotels every few days, was nicknamed “Dispose” by his Australian friends because of his propensity to dispose of pre-paid mobile phones.
Haeusler later told police that McManus was repaying Hanson who had stumped up the deposit McManus needed for a ZZ Top tour.
The suitcase of cash was then hidden by Hanson in the ceiling of a rented apartment in Kent Street for three months. In August he handed the suitcase of cash to his personal trainer, Sean Carolan.
On August 11, 2011, police received an anonymous tip-off that the occupant of room 3026 in the Hilton Hotel had a gun. The occupant, Carolan, a former cage fighter and racehorse trainer turned personal trainer, didn’t have a gun — but he did have a black suitcase containing McManus’s $702,000, which the police seized.
Carolan’s subsequent legal fight to recover the money has brought to light a bizarre series of events.
On the night police seized the cash, Carolan said he was merely minding the money for Hanson, who didn’t want to lose any more at the casino.
CCTV footage from Star City casino obtained by the police shows earlier that day Carolan and Hanson were in a heated conversation with Robert Cipriani, a well-known American high roller who calls himself Robin Hood 702 (702 is the telephone code for Las Vegas).
Police records note that Cipriani “is well known to the casino and is currently of interest to the Australian Federal Police”.
The day after the cash was seized, Cipriani left for Los Angeles.
During the investigation into the suitcase, police interviewed Hanson by videolink from the Beverly Hills police station in Los Angeles. “Do you want me to tell you the, the full story of how basically this money was laundered…?” Hanson offered.
He said the cash had come from McManus but, contrary to Carolan’s initial version, Hanson claimed he had given the money to Carolan to invest in Carolan’s weight loss clinic.
As well as expressing concern at Hanson’s use of the word “laundered”, Justice Richard Button noted in his judgment on Monday, “There is no satisfactory explanation why Mr Hanson would invest hundreds of thousands of dollars in cash in the business concept of a personal trainer who resided in a foreign country and whom he had known for no more than several weeks.”
Justice Richard Button refused to hand the $702,000 back to Carolan, saying he was not convinced he was “lawfully” entitled to the money.
Carolan was ordered to pay the police costs.
When he was interviewed by police in April 2012, McManus told them the money was his. “It’s pretty obvious though. I gave someone 700 large, and you’ve found someone with 700 large. It’s my 700 large.”
McManus told the police that the cash was part of a business deal where he was repaying the money to Hanson, who had lent him cash as a deposit for a ZZ Top tour but now he wanted it back to fund a Lenny Kravitz tour.
“In essence, I delivered back 700 grand I now need to borrow it again. As quickly as possible,” he said.
He also said; “It’s not the proceeds of crime, it’s the [proceeds] of Andrew McManus.”
McManus made remarkable admissions during his record of interview with police. He has since claimed he was under the influence of morphine and alcohol at the time.
The rock promoter volunteered to police that he had been “under suspicion by the NRL, for making player payments to rugby league players”.
This was a reference to the Melbourne Storm salary cap scandal in 2010 when it was revealed that McManus had facilitated extra payments to Storm players including Greg Inglis, Cameron Smith and Billy Slater.
His company, Andrew McManus Presents, would bill the Storm for “promotional” events. The money would be then be channelled by McManus’s company through to several Storm players.
The Storm were later stripped of their points and previous premiership titles.
Neither the players nor McManus were accused of any wrongdoing but McManus told the police of the fallout which included the Australian Tax Office going through him like a dose of salts.
“Although I did make tax payments on each player payment, I never actually got them to sign a full stat dec. So, of those players, they decided that they would fine me…between 30 per cent and the 49 per cent.”
He said he had to pay the ATO $120,000 per player, which totalled $2.4 million. “It crushed my company…Andrew McManus Presents International,” he told police.
Because of his ensuing financial difficulties he said he used friends and associates to help fund tours. McManus mentioned that Liberal powerbroker Michael Kroger and his brother Andrew had invested in his concert tours.
He said on five or six occasion, Michael Kroger had “put cash in and then I’ll, you know, fold it out.”
A spokesman for Michael Kroger said it was “a standard financial arrangement”.
McManus also boasted of withholding cash ticket sales from bands such as Fleetwood Mac. “I sold over $700,000 in cash tickets, because people wanted the best tickets, they come to the office, they ring up or email.”
“I’m not sharing it with the band…the cash stays in Andrew McManus’s pocket,” he told police.
McManus also told the police that he had accepted $450,000 in cash from the Coffin Cheaters, an outlaw motor cycle gang who were promoting the Perth leg of the ZZ Top tour.
During his police interview, McManus was accompanied by his lawyer and former partner in a Sydney nightclub, Michael Croke.
Croke, who represented Haeusler in his drug trial, also acted for McManus, Hanson, Haeusler and finally Carolan in the latter’s unsuccessful attempt to have the money returned.
During the case, Haeusler was pacing up and down the corridor outside the Supreme Court in Sydney.
McManus declined to comment for this story. He has issued a media release suggesting revelations about the suitcase and the cash were “gutter journalism by a bottom feeder” and that the articles had been written under “the protection of impossible deformation (sic) laws.”