Banknote bribe accused face court

Posted on August 14, 2012

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General Director Luong Ngoc Anh

EIGHT executives of Reserve Bank subsidiaries were involved in a conspiracy to bribe public officials at foreign banks in a bid to secure contracts to make plastic banknotes, a court has been told.

The men are alleged to have paid multi-million-dollar commissions to middlemen with connections to high-ranking public officials at foreign banks in Indonesia, Malaysia and Vietnam between 1999 and 2004.

Large portions of the commissions were allegedly passed onto the officials as bribes in a bid to obtain and retain contracts for banknote companies Note Printing Australia (NPA) and Securency.

The Reserve Bank of Australia owns 100 per cent of NPA and 50 per cent of Securency.

At a committal hearing in Melbourne Magistrates Court on Tuesday, Prosecutor Nicholas Robinson, SC, said emails between the middlemen and the executives indicated the extent of the bribery and their attempts to hide it.

In some cases, the bribes would be disguised on invoices as payments for interpreters, travel and public relations costs, he said.

“The agent was promised a (commission) on the basis that it was agreed and understood that out of his commission he would provide bribes to bank officials to obtain the contract that was the subject of the negotiations,” Mr Robinson said.

Elizabeth Masamune

Mr Robinson said the companies managed to secure several contracts worth tens of millions of dollars over a period of five years from State Bank Vietnam after paying more than $15 million to accounts held in various countries by a middleman named Luong Ngoc Anh.

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The court heard Mr Anh’s services had been recommended by trade commissioner Elizabeth Masamune for his high-level connections to Vietnamese bureaucracy, after the executives contacted Austrade for advice on entering the Vietnamese market.

When Securency sales executive Clifford Gerathy questioned a request by Mr Anh to fund an overseas trip for bank officials, Ms Masamune told him it was common practice in Vietnam for foreign suppliers to pay for such trips, telling him: “There are plenty of other competitors who will.”

In another email exchange when Mr Anh requested an increase in his commission, Gerathy said the increase would be granted if State Bank Vietnam committed in writing to granting contracts to Securency instead of putting them to tender.

“We would be prepared to increase the commission to 10 per cent in recognition of a significant achievement,” he wrote.

The conspiracy was allegedly driven by Securency chief executive Myles Curtis, but involved the other seven – Gerathy, Mitchell Anderson, John Leckenby, Peter Hutchinson, Christian Boillot, Barry Brady and Rognvald Marchant – at various stages.

All eight are charged with conspiring to provide a benefit to a foreign public official in order to obtain or retain business while Gerathy and Curtis are also charged with dishonestly making a false debit note.

The hearing continues before Magistrate Phillip Goldberg.

The Australian

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Posted in: Corruption