UMNO gets honorable mention in Aussie Bank bribery probe

Bank bribery probe widens to Europe and Asia

RICHARD BAKER AND NICK MCKENZIE

May 26, 2010

           

CORRUPTION investigations have begun in Britain, Indonesia and Malaysia into alleged bribery by the Reserve Bank of Australia's currency printing subsidiaries, as calls grow for the federal government to hold a public inquiry.

Details of the investigations come after the RBA yesterday released a statement saying it ''condemns corrupt behaviour'' and took recent revelations about its subsidiaries' alleged willingness to pay bribes and supply prostitutes to foreign officials ''very seriously''.

Federal backbencher Kelvin Thomson has become the first Labor MP to break the government's year-long silence over the affair, saying a public inquiry may be necessary to remove a ''stain on Australia's reputation''.

Australian Federal Police commissioner Tony Negus told a Senate committee yesterday that he had 20 investigators in several countries working on the probe into alleged corruption by Securency International, a firm half-owned by the RBA, which exports polymer banknotes.

Securency and its sister company, Note Printing Australia, are under scrutiny for paying more than $US50 million to middlemen in corruption-prone countries after they were awarded note printing and supply contracts by foreign central banks.

Mr Negus said Britain's Serious Fraud Office was involved in the Securency investigation as some of the company's top executives and well-paid middlemen were based in London.

He revealed the Australian Crime Commission had been involved in the case and admitted the AFP ''could have done more'' to act on an initial complaint from a Securency employee in 2008.

The AFP probe did not begin until a year later after The Age exposed concerns about Securency's dealings in Africa and Asia.

Mr Negus was reluctant to answer many questions.

The Age can also confirm anti-corruption authorities in Indonesia and Malaysia are examining deals involving middlemen hired by the RBA firms to win contracts in both countries.

Indonesia's Corruption Eradication Commission has for at least two years been investigating deals involving Jakarta businessman Radius Christanto - who the RBA firms hired to help win contracts - and the country's central bank, Bank Indonesia, and state-owned currency printer, Perum Peruri.

''We know the core of the case now and preliminary findings show an element of corruption and bribery,'' Indonesian corruption commission spokesman Johan Budi said.

It was reported this week that Securency and NPA agreed to pay Mr Christanto a $US3.65 million commission after he helped win a 1999 contract to print 100,000-rupiah banknotes for Bank Indonesia.

Correspondence from Mr Christanto in 1999 suggests two other men believed to be Indonesian central bank officials were to receive $US1.3 million in bribes from Securency and NPA.

Malaysia's Anti-Corruption Commission is helping the AFP trace what happened to the $4 million Securency paid its Malaysia agent Abdul Kayum Syed Ahmad after winning a 2004 currency printing contract.

AFP agents are to go to Malaysia to work with anti-corruption investigators. Mr Kayum is believed to be closely linked to Malaysia's ruling UMNO political party and government figures.

Mr Thomson yesterday said: ''The AWB oil-for-food scandal put a stain on Australia's international reputation by suggesting Australia was prepared to pay bribes and kickbacks to advance our international business interests. The Securency scandal has regrettably reinforced this impression.

''There needs to be action - either by the AFP or from a public inquiry - to make it clear to the world that we do not regard the payment of bribes, kickbacks or commissions as an acceptable way to promote our exports,'' he said.

Greens leader Bob Brown and independent senator Nick Xenophon have also called for a public inquiry.

With ROFFIE NDAOT