By Mike Steketee and Ean Higgins (The Australian Newspaper)
October 31, 2003
Stockbroker Rene Rivkin, former Labor minister Graham Richardson and company director Trevor Kennedy will be investigated for possible breaches of the law over millions of dollars channelled through secret Swiss bank accounts.
The Australian Securities & Investments Commission announced yesterday it would set up a specialist review team on the issue. As well, the Australian Taxation Office will look at whether tax is owing.
Treasurer Peter Costello said yesterday the corporate regulator "will be expected to enforce the law without fear or favour", as it had done in recent times in bringing charges against high-profile people.
He added the secrecy of Swiss banks was a weakness in enforcing tax law and one that Australia wanted to see tackled.
The OECD had prepared a report on international tax havens.
"We are working very, very hard in the OECD to try and encourage Switzerland to come into this project, which would mean it would exchange information with the Australian Taxation Office," Mr Costello said.
Following revelations in Switzerland, ASIC will examine whether the three high-profile businessmen met disclosure requirements under corporate law over their 38 per cent shareholding in Offset Alpine, bought in 1992 from Kerry Packer's Australian Consolidated Press by Mr Rivkin's investment company Stroika.
None of the three returned calls to The Australian yesterday.
Mr Kennedy is a former chief executive of Mr Packer's Consolidated Press Holdings and Mr Richardson, a right-wing Labor powerbroker who was a minister in the Hawke and Keating governments, has worked for Mr Packer as a lobbyist and journalist since 1994.
Offset Alpine's Sydney printing plant burned down on Christmas Eve 1993. The printing presses were valued at $3 million but were insured for $42 million. The total insurance payout came to $53 million - a windfall for the company that sent its share price soaring.
One-time shareholders of Offset Alpine following its sale by Mr Packer included insurance company FAI, whose chief executive is Rodney Adler; Sean Howard, one of the founders of internet company Ozemail; former Labor leader and governor-general Bill Hayden; and television journalist Ray Martin.
ASIC's predecessor, the Australian Securities Commission, was thwarted during the 1990s by the secrecy provisions in Swiss banking laws in attempts to force disclosure of the ownership of the 38 per cent parcel of shares in Offset Alpine. In 1996, the tax office froze $26.3 million in proceeds from the Swiss share parcel deposited in a Melbourne bank account.
Ownership of the shares came to light because of a Swiss investigation into an alleged embezzlement of $300 million by an executive of the bank at which the Offset Alpine funds were held.
The Australian Financial Review reported yesterday that during a formal examination last December by Zurich District Attorney Nathan Landshut, Mr Rivkin revealed he had traded Australian shares through the Swiss accounts on behalf of Mr Kennedy and Mr Richardson.
Mr Rivkin quoted figures, which he said might not be exact, of 81 per cent of the Swiss parcel of shares owned by him, 7 per cent by Mr Richardson and 12 per cent by Mr Kennedy. He also identified about $1.4 million in a sub-account operated by Mr Richardson.
The Financial Review quoted a letter Mr Kennedy wrote to his Swiss lawyer in which he said he had transferred significant funds between Swiss banks. "I deliberately keep no records of my affairs in Switzerland." the letter said. "I am very circumspect about using the telephone between Switzerland and Australia."
Contacted last night, Mr Landshut said he would consider seeking help from Australian authorities in his investigations. He said a visit to Australia was possible. Mr Landshut would not discuss the witnesses - some of whom were victims who had lost money in the alleged embezzlement. But he said: "In this investigation there are a lot of victims and maybe they have relationships with Australia.
"A lot of money is missing."
Mr Landshut said he hoped to finish his investigation next year, after which it should go to court.
Questioned at yesterday's annual meeting of Publishing & Broadcasting Ltd, Mr Packer said he did not know Mr Kennedy and Mr Richardson were involved in the sale of Offset Alpine.