Sinodinos: 'Watch this space'

Senator Arthur Sinodinos tells
parliament he will be vindicated when he appears as a witness before the
NSW Independent Commission Against Corruption.
A company linked to the Obeid family with high-profile
Liberal Party figures on its board gouged millions of dollars from the
state-owned Sydney Water, including for limousines and political
donations, the Independent Commission Against Corruption heard on
Tuesday.




Assistant Federal Treasurer Arthur Sinodinos was on the board
of the Obeid-linked infrastructure company Australian Water Holdings
when it was stonewalling attempts by Sydney Water to inspect its books.





Senator Arthur Sinodinos Assistant Treasurer during Senate question time at Parliament House Canberra on Tuesday 18 March 2014. Photo: Andrew Meares
Under fire: Arthur Sinodinos in Federal Parliament on Tuesday. Photo: Andrew Meares






AWH had its expenses covered by Sydney Water under a
lucrative contract to provide water infrastructure in Sydney's
north-west. By late 2008, the utility was footing the bill for up to
$800,000 in monthly expenses, including $7333 paid to a slush fund
linked to former NSW energy minister Chris Hartcher and more than
$75,000 in donations to the Liberal Party.




Fairfax Media can reveal AWH donated a further $10,000 to
Treasurer Joe Hockey's campaign weeks before the 2010 federal election.



But the donation was returned in February 2013, after reports began to circulate about corruption concerns at AWH.





Corruption hearing: Obeid-linked water company gave $10,000.
Corruption hearing: Eddie Obeid is linked to Australian Water Holdings. Photo: Peter Rae






Documents at ICAC on Tuesday reveal the company also made a $2200 donation to the Queensland branch of the Labor Party.



Sydney Water, led by Kerry Schott, was trying to halt the
massive bills that AWH kept submitting without explanation or proper
documentation.



Senator Sinodinos, who was then treasurer of the NSW
Liberals, was one of the recipients of a 2010 email from fellow AWH
director John Rippon which read: ''If only the bitch [Dr Schott] was
gone we could deal with these guys.''





Dr Kerry Schott: in charge of Sydney Water.
Dr Kerry Schott: in charge of Sydney Water. Photo: Arsineh Houspian






The inquiry has previously heard that corrupt former ALP
powerbroker Eddie Obeid tried to ''eliminate'' Dr Schott by making false
corruption complaints against her. Mr Obeid unsuccessfully urged a
fellow minister to ''sack the bitch'', and claimed that Mr Hartcher
would make a corruption allegation against her.



Among the expenses being forced on Sydney Water were the exorbitant salaries the AWH directors were paying themselves.



Liberal Party fund-raiser and Obeid family associate Nick Di
Girolamo was on a $1.1 million salary, plus a $250,000 ''sign-on'' fee
and a bonus of the same amount.



Giving evidence on Tuesday, Mr Rippon was questioned about Mr Di Girolamo's salary package being charged to Sydney Water.



''Do you sense anything even slightly wrong with that?'' counsel




assisting the inquiry, Geoffrey Watson, SC, asked. ''No,'' Mr Rippon replied.



Mr Rippon himself received a salary of $1.7 million for working two days a week.



When asked about the hundreds of thousands AWH secretly
billed Sydney Water for its attempts to expand into Queensland, Mr
Rippon agreed it was inappropriate.



''That would be nothing more, nothing less than a fraud?'' he
was asked. ''Well, that's a harsh word but probably,'' replied Mr
Rippon.



Senator Sinodinos' $200,000 salary and bonuses were also allegedly covered by Sydney Water.



The commission heard that AWH's monthly expenses escalated after Mr Girolamo was appointed chief executive in 2007.



Expenses which had averaged $160,000 per month had ballooned to $800,000 at the end of 2008.



Asked whether AWH had billed thousands of dollars for
chauffeured limousines, including $1159 in June 2010, Mr Rippon said:
''I don't know. I don't whether it would have been appropriate.''



Mr Rippon's salary was paid to his company, which also owned a horse-breeding farm.



The commission heard that Mr Di Girolamo and Mr Rippon bought
a racehorse, Partner in Crime, from the farm for $50,000. The pair had
previously raced a horse called Perfect Crime.



Mr Rippon said Mr Di Girolamo was recruited because he was
''well-connected'' in Liberal circles. Senator Sinodinos was appointed
because of his business connections.



Mr Rippon said he knew an ''Obeid entity was involved'' in
buying a 30 per cent stake in AWH for $3 million. The family claims this
is a loan rather than a shareholding.



Senator Sinodinos, who denies any wrongdoing, has insisted he was unaware of the Obeids' financial involvement in the company.



A badly worded contract Sydney Water signed in 1992 ended up
giving AWH exclusive rights to deliver infrastructure in Sydney's
north-west.