Eddie Obeid: The rise, reign and fall of NSW’s most notorious political powerbroker

Eddie Obeid was renowned as a fearsome Labor kingmaker
His business and political empires became entwined
An ICAC finding of corruption lead to his prosecution

Obeid has been sentenced to five years’ jail, with a minimum of three years, for misconduct in a public office in relation to his family’s secret business dealings at Circular Quay.


Update 1.28pm 15/12/16

‘Bail is refused’

“I direct Mr Obeid be taken down [into the cells],” Justice Beech-Jones says.

After loosening his tie and handing his watch to his lawyers, Obeid was led from the dock in court five in the historic Darlinghurst Supreme Court by corrective services officers.

Justice Beech-Jones says Obeid’s lawyers have not established “exceptional circumstances” exist to warrant a grant of bail pending his appeal against conviction and sentence.

“I do not accept Mr Obeid’s appeal rises any higher than being reasonably arguable,” he says of the merits of the foreshadowed appeal.


Eddie Obeid to be stripped of parliamentary pension as Baird government reacts to his sentencing

  • Sean Nicholls

Former Labor minister Eddie Obeid is set to be stripped of his annual $120,000 parliamentary pension following his sentencing for wilful misconduct in public office.

On Thursday, Obeid was sentenced to a maximum 5 years in jail with a non parole period of three years.

Shortly afterwards, Premier Mike Baird announced MPs convicted of a serious offence during their time in office will lose their parliamentary pension, even if they quit before charges are laid.

The announcement means Obeid is set to be stripped of his lifetime annual pension worth more than $120,000 a year.

Presently MPs convicted of a serious offence – punishable by at least five years imprisonment – can keep their pensions if they are not charged while in office.

“The crimes of Eddie Obeid and his cronies are the most serious instance of official corruption we have seen in our lifetimes,” Mr Baird said.

“Regardless of political affiliation, any MP who commits a serious offence while in office should face the consequences, and should not be shielded simply because they resign before being charged.

“We will work cooperatively with the Opposition and cross-bench MPs over the summer recess to bring forward amendments that repair this glaring anomaly, and we will make sure they capture Obeid and any others who find themselves in his situation.”

The change will require an amendment to legislation to be put to parliament early next year.

The Baird government has also indicated it will claw back the estimated $280,000 legal assistance he was given for this particular ICAC inquiry.

MORE TO COME

Click here to read full sentencing judgement


Eddie Obeid sentenced for Circular Quay corruption

Michaela Whitbourn

‘Sanctity of jury verdict’

Justice Beech-Jones says the “public interest upholding the sanctity of the jury’s verdict” is a factor weighing against granting bail.

The corrupt former Labor kingpin’s lawyers have also suggested he should be granted bail because he is facing a committal hearing on other corruption charges next year.

The Supreme Court judge says it can be accepted it will be harder for Obeid to prepare for that case while in jail.

The judge decides

Justice Robert Beech-Jones is now delivering his decision on whether Obeid should be granted bail. It’s a busy morning for the Supreme Court judge.

Justice Robert Beech-Jones delivers his decision in the Eddie Obeid sentencing.
Justice Robert Beech-Jones delivers his decision in the Eddie Obeid sentencing.  

The final, final point

It feels like Obeid’s barrister is holding out the promise of a “final” point but there is always another one to be made.

Guy Reynolds, SC, says Obeid will appeal not only his conviction but his sentence.

And yes, he still wants “a release order or bail” pending that appeal. If he doesn’t get it from Justice Beech-Jones he is likely to ask the Court of Criminal Appeal to decide on that point too.

‘Unreasonable verdict’

Obeid’s barrister Guy Reynolds, SC, says he is moving onto his “final” point.

Not only does Reynolds say the jury was misdirected by Justice Beech-Jones, he says the jury’s verdict was “unreasonable and cannot be supported by the evidence”.

It’s good to cover all one’s bases.

Reynolds says he is “grateful” to the court for allowing him to set out the grounds of appeal, as “aggravating” as it may be.

He reiterates he is seeking bail for his 73-year-old client pending an appeal.

Eddie Obeid outside court this morning.
Eddie Obeid outside court this morning. Photo: Daniel Munoz

Still here

Oh yes, we’re still here in court. Obeid’s barrister Guy Reynolds, SC, is fleshing out his submission there has been a miscarriage of justice.

Obeid has no intention of going to jail and his legal team wants Justice Beech-Jones to grant bail today.

Get comfortable. This could be a while.

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Obeid to be stripped of pension

The Herald‘s state political editor Sean Nicholls has the exclusive: the Baird government will strip Obeid of his annual $120,000 parliamentary pension following his jail sentence for misconduct in public office.

Read the full story here.

Someone's having a good day, and it ain't Eddie.
Someone’s having a good day, and it ain’t Eddie. Photo: James Alcock

No love lost

Former Labor premier Kristina Keneally is out of the blocks early to offer her views on Obeid’s jail sentence. She’s not mincing her words.

It ain’t over

Usually when a person is sent to prison, they are taken away from the courtroom almost immediately by corrective services.

Not so in the Obeid case. His lawyer, Guy Reynolds, SC, is in full flight about the alleged miscarriage of justice suffered by his client. He wants bail.

An impassive Obeid remains in the dock as Reynolds and Justice Beech-Jones engage in a robust discussion about the latter’s summing up to the jury.

What next

An appeal is already in the offing but for the time being Obeid is going to jail for a maximum of five years, with no possibility of release for three years.

What next? Glad you asked. Obeid and his entrepreneurial middle son, Moses, have been charged over a separate deal exposed at ICAC, relating to the very fortuitous creation of a coal mining tenement over their rural property in the Bylong Valley near Mudgee.

The deal netted the Obeid family $30 million, ICAC heard.The men will face a three-week committal hearing starting on May 29 to test the strength of the prosecution’s case and determine if they should stand trial.

Moses Obeid outside the Supreme Court earlier this year.
Moses Obeid outside the Supreme Court earlier this year. Photo: Daniel Munoz

Appeal, anyone?

Obeid’s barrister, Guy Reynolds, SC, has leapt to his feet and, as foreshadowed, is already flagging an appeal.

He says there has been a “miscarriage of justice” and they will need to trot off to the Court of Criminal Appeal.

“The prospects of Mr Obeid succeeding … on appeal are extremely high,” Reynolds says.

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Jail only appropriate penalty

Obeid will go to jail, Justice Beech-Jones says.

“Given the nature of the offending and notwithstanding Mr Obeid’s personal circumstances, I am satisfied that, having considered all possible alternatives, no penalty other than imprisonment is appropriate,” he says.

“Mr Obeid, will you please stand up.”

Five years

Justice Beech-Jones has sentenced Obeid to a maximum of 5 years in jail, with a three-year non parole period.

‘Not an opinion poll’

This is it. “Conclusion,” Justice Beech-Jones says clearly.

He says sentencing is not conducted via “opinion polls”.

“If Mr Obeid had not willfully abused his position as a parliamentarian, then his life and career would be a testament to the values of hard work, family and public service. Instead, his time in public life has produced a very different legacy.”

Life expectancy

And we are inching closer. Justice Beech-Jones says a jail sentence should not be reduced because it would consume “most of an offender’s remaining life expectancy”.

Medical conditions

The court hears Obeid suffers from a litany of medical conditions. He had a stroke earlier this year, has had type two diabetes “for years”, has high blood pressure and colonic polyps.

He also tripped on a coffee table earlier this year and was taken to hospital.

However, the conditions are “stable and controlled”, according to medical evidence.

But expert evidence tendered by Obeid’s legal team says it is “unlikely that … Obeid would receive appropriate medical treatment in custody if he was incarcerated”.

Justice Beech-Jones says he accepts Obeid would receive “a superior level of care in the community” but he is satisfied “he would receive an adequate level of care” in jail.

Eddie Obeid outside court this morning.
Eddie Obeid outside court this morning. Photo: Daniel Munoz

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All in the family

Justice Beech-Jones says the evidence suggests the Obeid family is “exceptionally close” and would be hit hard by the jailing of the patriarch.

But he notes it was Obeid’s decision to prioritise the interest of his family above his duty to the public that led to his offending.

A parliamentarian cannot use their position to “afford generosity” to their family or associates, he says.

‘Mitigating factor’

Obeid enlisted 55 character witnesses in his fight to avoid jail. Justice Beech-Jones says they are evidence of “prior good character”, which is a “mitigating factor” in sentencing.

However, he says in cases of corruption the “need for deterrence is particularly strong” and the references will be “afforded less weight”.

‘Deliberate breach of trust’

Justice Beech-Jones is getting closer to delivering those final words: to jail or not to jail.

He says the essence of the offence of misconduct in public office is a “deliberate breach of trust”.

The seniority of the public official is relevant, along with the nature of the breach.

The Supreme Court judge is surveying relevant cases, and says they demonstrate the “onerous duty” imposed upon parliamentarians and ministers.

Eddie Obeid outside court this morning.
Eddie Obeid outside court this morning. Photo: Daniel Munoz

The penalty

Now we’re getting down to it. Justice Beech-Jones is setting out the principles for sentencing Eddie Obeid.

In NSW the offence of misconduct in public office is not codified in an act of Parliament – it is simply part of the common law (law made by judges).

That means the maximum penalty has not been set out in legislation and is technically “at large”, meaning life.

But in other states, where the offence has been codified, the maximum penalty is about seven years. This is relevant but the court is not “limited” by that, Justice Beech-Jones says.

He says there is “no difference in substance” between a politician receiving a bribe to advance someone else’s interest and using their position to line their own pockets.

‘Makes no difference’

It makes no difference to Obeid’s criminality whether he was acting to advance his own financial interests or those of his family, Justice Beech-Jones said


Eddie Obeid: The rise, reign and recession of NSW’s most notorious political powerbroker

Analysis

12.20pm 15/12/2016

The sentencing of former Labor powerbroker Eddie Obeid is a day of reckoning for a man who once wielded his influence to build and destroy the careers of premiers and MPs in New South Wales.

Key points:

  • Eddie Obeid was renowned as a fearsome Labor kingmaker
  • His business and political empires became entwined
  • An ICAC finding of corruption lead to his prosecution

Obeid has been sentenced to five years’ jail, with a minimum of three years, for misconduct in a public office in relation to his family’s secret business dealings at Circular Quay.

Edward Moses Obeid was born in a village in northern Lebanon in 1943, and after moving to Australia as a child, worked as a cab driver and at local Arabic-language newspaper El Telegraph.

Within a few years he was running that newspaper, and was recruited by Labor powerbroker Graham Richardson to join the party in 1972.

ABC investigative journalist Marion Wilkinson’s book The Fixer describes how Obeid was soon providing invaluable advice to Richardson on how to politically organise ethnic communities.

It was Mr Richardson who gave Obeid the necessary backing to see him elected to the NSW Upper House in 1991, and he rose through the ranks to become the minister for fisheries and mineral resources from 1999 to 2003.

But it was his creation and control of the so-called Terrigals sub-faction of the Labor Right that would go on to dominate NSW Labor for the better part of two decades.

One king to rule them all

The sub-faction was formed, with Obeid its undisputed king, at a now infamous meeting at his beach house in Terrigal in 1992.

It went on to use its numbers relentlessly to fundraise, control pre-selections, guide policy and elevate chosen MPs to the frontbench.

At the height of its powers, the Terrigals sub-faction was instrumental in installing and removing a series of premiers — namely Morris Iemma, Nathan Rees and Kristina Keneally.

Mr Iemma has said his premiership became “untenable” because he could not convince the Terrigals to approve his preferred ministerial reshuffle.

Mr Rees was rolled after standing up to the sub-faction by sacking Ian Macdonald and Joe Tripodi from the ministry.

Just before he was knifed, Mr Rees famously said: “should I not be Premier by the end of the day, let there be no doubt in the community’s mind, no doubt, that any challenger will be a puppet of Eddie Obeid and Joe Tripodi.”

How the empire unravelled

But Obeid’s influence was broader than the parliamentary caucus.

His diary entries from 2007 to 2009, tendered to Independent Commission Against Corruption (ICAC) hearings, show a revolving door of developers, union bosses and business figures queuing up to seek appointments with him.

With a string of business and property interests in both Australia and Lebanon, Obeid was already wealthy when he entered Parliament and he continued to build both his financial and political empires while an MP.

And it was the mixing of his political and business ties which eventually led to him being convicted on June 28 this year of misconduct in a public office.

Obeid was found to have lobbied the then-deputy chief executive of the State Maritime Authority, Steve Dunn, over Circular Quay leases — without revealing that his family secretly owned a series of harbourside cafes in the Quay.

The Crown said Obeid knew Mr Dunn from when he had been fisheries minister, and argued that he misused his position as an Upper House MP to “dupe” Mr Dunn into believing he was acting on behalf of constituents.

The court found he was in fact trying to stop a competitive tender process for the leases to financially benefit his own family.

Prosecution not to be scoffed at

The prosecution stemmed from a corrupt conduct finding by the ICAC.

In his findings in the ICAC inquiry into the Circular Quay leases, assistant commissioner Anthony Whealy described the former MP’s actions as demonstrating “the moral vacuum at the core of his political being”.

When the ICAC first handed down its finding, Obeid scoffed that he believed there was “less than a one per cent chance” that he would be prosecuted as a result.

Even when charged, he still said he had “no concerns whatsoever” and was “very confident” he would not be convicted because he was innocent.

The court found otherwise.

Labor has done its best to exorcise itself of Obeid, ending his influence and calling for the courts to throw the full force of the law at him.

But no matter how hard it may try, Obeid’s fingerprints will forever remain all over a chapter of its political history in NSW.

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