Moses Obeid boasted that a mooted $100 million water deal “eclipsed” his family’s notorious Mount Penny coal venture, the NSW corruption watchdog has heard.
In sensational testimony before the Independent Commission Against Corruption (ICAC), former Lehman Brothers banker Gardner Brook said the son of former MP Eddie Obeid told him in 2008 the water deal would bring in “a bucketload of money”.
Mr Brook told the inquiry the Obeids thought they ran NSW and were looking at a privatisation deal which would make a fortune.
The ICAC is probing allegations infrastructure firm Australian Water Holdings (AWH) billed the state-owned Sydney Water for limousine rides and trips to luxury Queensland hotels.
Mr Brook told the ICAC on Tuesday he got to know Moses Obeid while working on a coal deal at Mount Penny in the NSW Hunter region – a deal the watchdog has already branded corrupt in a separate inquiry.
“Moses said that he and his family had an ownership in Australian Water (Holdings) and that they had great influence over it,” Mr Brook recalled in a written statement.
“The company was looking into a privatisation deal where they could effectively control all of Sydney’s water. Moses said, ‘We are going to make a fortune out of it’.”
Mr Brook told the commission a payoff of $100 million was mentioned.
Mr Brook said he met with the two Obeids and and former Labor MP Joe Tripodi in August 2008 in Elizabeth Bay, where the men canvassed selling off NSW electricity assets and Moses repeatedly declared “this conversation’s not happening”.
Mr Brook didn’t understand at the time, he said, “but I’ve figured it out since”.
“It’s fairly obvious that these people thought they were running the state of NSW,” he said on Tuesday.
Lawyers for the Obeids suggested Mr Brook “had a problem with intoxicants” in 2008 or that he suffered memory loss after a 2010 accident.
But Mr Brook stood by his testimony.
“My recollection is sharp. Razor-sharp,” he said.
Counsel assisting Geoffrey Watson SC this week zeroed in on documents he says provide “hard evidence” that AWH’s Sydney Water billings amounted to fraud.
Sydney Water had agreed to pay for AWH’s costs as the company built water infrastructure around Sydney’s northwest.
It has been alleged the utility also picked up the tab for payments made to lobbying firm SolutionsRUs, Qantas flights and luxury lodgings at the Sofitel Hotel in Cairns and the Conrad Treasury in Brisbane.
It has also been alleged Sydney Water paid for a chauffeur to drive Eddie Obeid Junior and ex-AWH chief Nick Di Girolamo around Sydney.
Ian George, who certified AWH expenses while working for accounting firm MBT, said some payments appeared to have been rubber-stamped in error but that invoices were generally reviewed.
“Somebody sat down and thought, ah yes, they must have been driving to Acer Arena with what, sewerage pipes in the boot?” Mr Watson asked.
“How could this happen? What was going through your mind when you signed the certificates month in, month out which included these items?”
The inquiry continues.