Thursday October 3 2013
– Leighton Holdings’ offshore arms enlisted a network of Middlemen with links to influential officials in corruption-prone countries to help it win huge contracts.
Those middlemen included a Monaco firm with ties to former Libyan dictator Muamar Gaddafi and senior Iraqi politicians.
Company files indicate the Australian construction giant paid Monaco’s Unaoil $40 million at the direction of the Iraqi Oil Ministry as part of a 2010 contract suspected of being corrupt.
The ministry had nominated Unaoil as the subcontractor that would provide domestic support to Leighton Offshore on a $750 million oil pipeline project.
The files suggest Unaoil, which has employed former top Iraqi oil officials, received its money after the Australian company allegedly artificially inflated the value of an onshore support services contract by $40 million.
The Monaco firm, owned by a prominent Iranian family, stood to receive a further $25 million from Leighton via a proposed extension of the Iraqi pipeline project, company files show.
The Australian Federal Police is investigating payments associated with the Leighton Iraq venture after the company contacted it about suspect payments in late 2011. Hong Kong court documents reveal that Unaoil, which declined to answer questions from Fairfax Media, and Leighton are now in dispute over money.
In a separate case, an English High Court judgement in 2012 described Unaoil as being well connected with the former Gaddafi regime in Libya and had in the course of its work with another firm disguised a $4 million commission payment as “office expenses”.
Leighton companies have also won business and courted political influence through an array of colourful Asian businessmen.
Malaysian-based businessman Pakianathan Sri Kumar has been involved with Leighton contracts in Iraq, Indonesia, Tanzania and India.
Leighton documents show Mr Sri Kumar was paid by India’s giant Adani Group in relation to the construction of a barge in Indonesia.
This barge was built with steel that had been illegally bought by an allegedly corrupt former Leighton executive. Mr Sri Kumar has denied any wrongdoing.
In 2011 the Adani Group was accused by an Indian ombudsman of alleged bribery relating to a mining project in India, a claim the company has rejected.
Elsewhere in India, executives from the Leighton joint venture partner for major road projects, Oriental Structural Engineers, were arrested by the country’s Central Bureau of Investigation in 2010 as part of probe into allegedly rigged highway construction contracts.
In Malaysia, Leighton courted political support by entering into a 2008 deal to train and employ students from a Malaysian TAFE owned by a political party and chaired by a government minister who has been awarding contracts to the Australian company since the 1980s.
The Kolej TAFE is owned by the educational arm of the Malaysian Indian Congress, a political party that is part of Malaysia’s government. It is chaired by a former minister for works, Sammy Vellu, a politician who has been embroiled in corruption scandals, but never found guilty of offences.
The deputy chairman of the Leighton Malaysian subsidiary, Tan Sri Hari Narayanan, is also associated with the educational arm of the Malaysian Indian Congress political party.
Mr Narayanan was a director of the Malaysian Highway Authority, a statutory authority overseeing major road projects, at the same time the Australian firm was building government-funded highway extensions in Kuala Lumpur in 2007.
– Richard Baker & Nick McKenzie