Eddie Obeid leaves the NSW Supreme Court yesterday. Picture: Toby Zerna
He was the godfather of NSW Labor politics. With arrogance fuelled by years of accumulated power and wealth, Eddie Obeid ruthlessly made and unmade premiers. It seemed Obeid was made of Teflon as no allegation about his corrupt business dealings was damning enough to stick.
Until now. The finding by a NSW Supreme Court jury yesterday that Obeid is guilty of wilful misconduct in public office is the final disgrace for a man who has treated politics over the decades primarily as a way to enrich himself. The jury decision means the Lebanese-born businessman and former ALP powerbroker could spend a long stretch in prison — with a maximum term estimated at 10 to 14 years for such a gross betrayal of public trust.
But just days away from the federal election, with opinion polls showing Labor Opposition Leader Bill Shorten struggling, and the Turnbull Coalition comfortably ahead, the Obeid verdict is also a shocking reminder of Labor’s worst side.
Obeid’s proven misuse of his former position as a NSW Labor minister by lobbying for lucrative government contracts up for tender but failing to declare his secret interests in them highlights rottenness that has flourished in the ALP’s godfather’s world and which Shorten wants voters to believe is a thing of the past.
For Obeid, it has been a life of greed, excess and putting the concerns of voters last in his selfish quest for riches. After a three-week trial, the jury took less than a day to find Obeid guilty of deliberately hiding his family’s lucrative cafe interests at Sydney’s Circular Quay in 2007, while lobbying Steve Dunn, then the deputy chief executive of the NSW Maritime Authority, to bypass a tender process for the renewal of contracts.
Obeid, who pleaded not guilty, knew Dunn well. Obeid was at the time the fisheries minister in the Iemma government and Dunn, who faces no accusations of wrongdoing, had only recently taken the Maritime Authority job after serving as the head of Obeid’s department.
Obeid wilfully hid his Circular Quay interests on wharves four and five by disguising their ownership. It was a two-step removal from Fast Eddie: the cafes were owned by one family trust, which was owned by another. Obeid tried to argue his distance by claiming the ownership was spread among his wider family — but allegations surfaced during the trial that the man himself sometimes received “cash-filled envelopes”.
The fall of Eddie Obeid has been a long time coming. At least three former NSW Labor premiers yesterday treated the result as a form of karma. After 10 years of Bob Carr as premier, Obeid was the kingmaker for his successors: Morris Iemma, Nathan Rees and Kristina Keneally. In a relative quick time, Obeid used the power of his Terrigals faction within the NSW Right to dispatch two of the premiers because they would not do his bidding and his association with the third contributed to a shattering election defeat.
Obeid gave Iemma his backing — but soon destroyed him politically by siding with unions when Iemma showed too much independence and bucked the system by trying to privatise the NSW electricity grid. He promoted Rees, but destroyed him too when Rees had the temerity to push Obeid out of the ministry. Keneally, while favoured by Obeid, came to resent him: she struggled to escape the label — given by Rees in a parting shot — that she would be the puppet of Obeid and his factional ally, Joe Tripodi, if she accepted the premiership.
Such was his influence within the NSW ALP, Obeid could hand a Labor premier his list of preferred ministers. Even Carr, while tolerating Obeid for many years, and not suffering at his hands like other premiers, tired of the stench that surrounded the supposed kingmaker. Obeid survived one scandal, following allegations aired in The Sydney Morning Herald that he had attempted to solicit a $1 million payment in return for promising government support for the proposed Oasis development in Sydney’s southwest. He even later won a defamation action over the allegations.
But Carr, after winning the 2003 election victory, told Obeid that he could not have someone in his ministry who was subject to “unending controversy”. The last straw for Carr, according to Kate McClymont and Lynton Besser’s book He Who Must Be Obeid, was hearing Obeid’s pre-Oasis defence in cabinet of the alleged bribes sought from developers by a deputy mayor of Rockdale Council. “Well, someone has to get paid,” Obeid reportedly said.
Migrating with his Christian Maronite parents from northern Lebanon at the age of six, Obeid grew up in inner-Sydney Redfern, and started out as a taxi driver before getting into property development. He joined Labor in 1972, and the following year bought into a Sydney-based Arabic newspaper, El Telegraph. He took charge of the paper, rose through the ranks of the Lebanese community and came to the attention of Labor powerbroker Graham Richardson. He scored a NSW upper house seat in 1991 — the start of a 20-year career in parliament — and was known most for never giving a speech.
One of Obeid’s earliest known controversial property deals was to buy an apartment block for $875,000 in 1991 and sell it the next day to the NSW Department of Housing for $1.1m.
Over the years, Obeid has had a run of bad luck with fires. The one that drew the most attention occurred at Obeid’s Offset Alpine not long after he had sold it to the late Rene Rivkin. The Rivkin deal was a sore point because Rivkin’s investment group scored a $53.2m insurance payout from the fire.
Yesterday’s conviction is a rare victory for the NSW Independent Commission Against Corruption. It started investigations into Obeid’s dealings in 2012 following allegations that he might have benefited from coal exploration licences approved on Obeid farmland in the Hunter Valley in 2008 by then NSW Labor mineral resources minister Ian Macdonald. A year later, ICAC found that Obeid, Macdonald and Macdonald’s former coalmining union mate John Maitland were corrupt and should face charges over the Bylong Valley mining tenement. All three have fought hard against the findings ever since.
It was the Circular Quay contract that finally brought Obeid down. He scoffed in 2013 at the prospect of charges, saying then that the chance was “1 per cent”. Obeid is on bail. He has been stripped of his ALP membership and a gong for services to ethnic welfare. Eddie only ever served one type of welfare — his own.