Currency scandal: new files contradict Stevens

ARCHIVES 2012

By admin-s On Sep 12, 2012

Questions raised … Glenn Stevens. Photo: Tamara Voninski

(Sydney Morning Herald) – The arms dealer’s company wrote to Mr Campbell demanding further payments and stating that it had convinced the ”prime minister and the Malaysian cabinet” to give out contracts.

NEW internal documents have contradicted parliamentary testimony by the Reserve Bank governor, Glenn Stevens, that the bank knew nothing about the Securency banknote scandal before it was revealed by a Fairfax investigation in 2009.

The scandal involves the Reserve Bank companies Securency and Note Printing Australia, which were charged last year with bribing foreign officials to win banknote contracts.

The sensitive documents, seen by the Fairfax, which contradict Mr Stevens’s parliamentary testimony, come from the central bank’s files.

They show that in 2007:

The assistant governor Frank Campbell was told that Securency engineered a dodgy business deal to hide a $492,000 payment to an allegedly corrupt Malaysian arms dealer;

The arms dealer’s company wrote to Mr Campbell demanding further payments and stating that it had convinced the ”prime minister and the Malaysian cabinet” to give out contracts.

Reserve Bank auditor John Klincke allegedly queried a Securency manager about payments to an agent working for Vietnam’s spy agency, and was told in response: “Well, if I asked you if you worked for ASIO, you wouldn’t tell me, would you”.

The Herald can also reveal that the Reserve – unwittingly or otherwise – hampered the Australian Federal Police bribery inquiry by failing to inform it for several months in 2009 of incriminating documents it held regarding its subsidiaries’ activities.

In response to 18 questions from the Fairfax, the Reserve released a statement saying:

”The bank has sought to deal appropriately with all the issues that have arisen. It has co-operated fully with the legal authorities, notifying them of the existence of relevant documents and providing documents when requested. There has been no attempt by the bank to hide information from the authorities.

”Even if it were ultimately to be concluded, with the benefit of hindsight, that incorrect conclusions were drawn from the various investigations, the bank and the NPA board relied on the information available at the time and external legal advice. The bank’s executives acted in good faith and with integrity. It is completely without foundation to suggest otherwise.”

The fresh revelations have led to further calls for an inquiry into the bank’s handling of the scandal.