In the reams of quotations about wealth, a sizeable proportion relate to its powers to corrupt and debase human nature. Think Thomas Jefferson: ‘The more money, the less virtue.’ Think Andrew Carnegie: ‘To die rich is to die disgraced.’ By these lights, the BRW Rich List should be almost synonymous with Australia’s Most Wanted.
For a long time in Australia, a school of thought held business similarly suspicious. The Bulletin, in its turn-of-the-century pomp, put it most succinctly, covering commercial matters beneath the droll headline ‘Business, Robbery Etc’, as though from one could be inferred the other, as if the bank manager and the bushranger were easily and obviously transposable. It was a cheap point, but a meaningful one. In a country of supposedly egalitarian principles, to be rich was to be a bit disreputable – it was, at least, to stand out, a form of offence in a culture of widespread conformity.
The BRW Rich List has both reflected and abetted a change in the culture, wealth becoming respectable, even admirable, as well as merely desirable. But it has also tweaked our latent misgivings by throwing up its share of spivs, chancers, and old-fashioned rogues. Sometimes, embarrassingly, they have attracted the list’s attention just in that final last efflorescence before flaring out for good; a success story can be but a short distance from becoming a cautionary tale.
Recall, for example, George Herscu, a man who for whom the Rich List might almost have been devised. A headstrong, high-rolling collector of cars, planes and racehorses, he dressed with a dandified air and philosophised of his cheerful ostentation: ‘Beautiful things like Rolls-Royces and Jaguars are made for people to enjoy. Money should be enjoyed. I love to enjoy myself. To spend money. To dance – do the cha-cha. I love people with life in them and love to live.’ He had modelled his Whernside Avenue home on Tara in Gone With The Wind – a book he claimed to have read ten times, perhaps taking a little too much inspiration from Rhett Butler’s motto: ‘With courage, one can do without a reputation.’
For his reputation took a pounding when his corrupt relations with first the Builders Labourers’ Federation then Queensland’s local government minister Russ Hinze were revealed. In the Rich List of 1989, Herscu was valued at $300 million, and limned as ‘a survivor’, although he was admitted to have had a ‘bumpy year’. His fall from grace was then sudden and utter. Not only did he file Australia’s biggest personal bankruptcy, $496 million, but he was prosecuted for his indiscretions with Hinze. Perhaps no Rich List member has been pictured so abjectly as Herscu, crumpled in the back of the Black Mariah speeding him to prison for a five-year stretch.
For losing money alone does not a rogue make. No businessman worth their salt has not known some failure – sometimes costly, occasionally humiliating. Frank Lowy had his Westfield Capital Corporation, John Roberts his Wembley, Maurice Alter, Marc Besen and John Gandel their Max Green, Nicole Kidman her Stepford Wives. For some members of the Rich List, mistakes have been formative. Ask Lloyd Williams about what he learned during the property meltdown of 1974, or Lindsay Fox during his unhappy year running Linfox as a public company. ‘I learned by making mistakes and not duplicating them,’ Fox has explained.
No, the chief characteristic of the modern business rogue is a certain brazen incorrigibility – for which a nation of convicts might be felt to have a certain gift. After all, had there been a nineteenth century Rich List, it would have made up for in colour what it lacked in gross wealth. Wool tycoon John Macarthur, the ‘rich Botany Bay purturbator’, boasted that he had ‘never yet failed in ruining a man who had become obnoxious to him’. Landowner Charles Ebden, first settler on the Murray, went down in history for his mock self-reproach: ‘I fear I am becoming disgustingly rich’. Bank of Victoria owner Henry ‘Money’ Miller noisily advised embezzlers not to mess around: ‘If you ever feel a desire to go wrong, don’t prig cash or enter threepenny letters as sixpence. Collar £10,000 and be sure to burn the bally books.’
No Rich List exhibits this attribute in greater concentration than the gallery of 1987, which was probably read more avidly, and became obsolete more quickly, than any before or since. Much of the reporting has a certain piquancy. Brian Yuill is explained as having ‘established a complex web of companies’, as though the writer had simply been overcome by the headache of looking at them all. Kevin Parry is described as ‘yet another aggressive WA entrepreneur’ as if the stock of available adjectives had been exhausted by the state’s sheer financial flair. The ‘very widely respected Abe Goldberg’ is praised for his ‘commitment to the characteristically troubled textile and clothing industry’ – just as he was losing interest in it. Little did anyone realise that the impending annus horribilis would off them all along with many others.
The scenery was also suggestive. In hindsight, one of the list’s most eye-catching features is a two-page advertisement for Standard Chartered Bank, featuring a handsome fish on ice lying coldly next to a hook. The symbolism is as unsubtle as it seems. ‘If we can see you’ve got a good idea and the drive and skills to make it work, we’re hooked,’ reads the explanatory text. ‘From that point it’s all straight lines with us…If you’ve got a good idea and you know what you need to make it work, come and say g’day, we’ll probably take the bait.’ Come take our money, in other words: we’re so stupid, we’ll hardly notice.
Nobody incarnated this spirit more completely than the Perth parvenu Laurie Connell. Borrowers knew him as ‘Last Resort Laurie’ for the open handedness of his merchant bank Rothwells, although the Rich List that year generously assessed his wealth at $80 million: ‘His loud approach to almost everything has earned him some adverse publicity, but Connell dismisses this as “sour grapes”.’ At the time, he was planning Perth’s largest home, having demolished seven residences on a one-hectare block in prestigious Dalkeith, and owned more than 400 racehorses. No wonder Rothwells’ group treasurer would describe the effort of funding his boss as ‘like having to put out a bushfire each night’.
Nine weeks after the Rich List hit the streets, that bushfire broke through its containment lines: there was a run on Rothwells in the wake of the sharemarket crash. Connell rang none other than Standard Chartered – perhaps he had seen the ad. In fact, the bank’s local chief David Hurley recommended receivership – a course of action that might have changed history had it been taken. Instead, there commenced the first of three increasingly elaborate and hopeless rescue operations involving some of Australian business’s biggest names: Kerry Packer, John Elliott, Larry Adler, Richard Pratt, and Robert Holmes a Court, all improbably aligned with Connell’s close friend Alan Bond.
It gradually emerged that Connell was a commercial Typhoid Mary: he made a rogue of almost everyone he touched, including a Labor Premier, Brian Burke, of whom the same might now be said. A picture of Connell and Bond fishing with prime minister Bob Hawke and senator Graham Richardson embarrassed both politicians. Warwick Fairfax, Connell’s biggest client, entered his circle a wealthy naïf and left it a poorer idiot. Rothwells, originally a gentlemen’s outfitters, became a synonym for sleaze. A lurid Royal Commission revealed its finances to be a strange mixture of the sacred and profane. Among its biggest depositors was Perth’s Catholic Archdiocese; roughly two-thirds of the debt was owed by Connell companies, about $600 million vanishing into his affairs over three years and never coming out.
Some felt feint at the scale of the depredations. Corporate lawyer Aleco Vrisakis, brought in to wrangle the first rescue, took one look at the loan book and quailed: ‘I’ve got a very bad heart and I can’t cope with this.’ Others raged. At one famous conference with Connell’s advisers, Burke’s successor Peter Dowding prowled the room slamming doors and kicking furniture. ‘We have just paid $400 million for a petrochemical plant worth nothing,’ he roared. ‘Now we’re back to where we started. I am surrounded by liars and cheats. Now you want more money. Who are we saving from going to jail this time?’ Jail certainly beckoned, although in the Al Capone tradition of crooks eventually brought to book for relatively trifling offences, Connell served his porridge for bribing a jockey, Burke for rorting travel expenses.
Jail finally awaited Bond, too, who in a gallery of rogues almost deserves an entire wing, having brought business to a pitch of unequalled shamelessness. The wide boy who never paid a bill on time because it was ‘cheap money’ and who painted Yanchep’s sandhills green ‘to make the brochures look better’ turned into the big league buyer of breweries and blimps while scarcely changing his modus operandi. As Michael Grace told Bond’s biographer Paul Barry:
If he wanted something it was very hard not to say, ‘Yes, I agree with you, Alan.’ He just had that charm, that charisma, that complete belief in where he was going…No matter how many times we said ‘That doesn’t suit us Alan’, he just brushed it aside and kept going ahead. And then when we said, ‘Look, we can’t do that legally’, he said, ‘Oh, we’ll find a way around it.’ It did not enter his negotiating position that it couldn’t be done.
Bond wasn’t the first West Australian entrepreneur to cosy up to a vicious dictator, Lang Hancock having expressed golden opinions of Romania’s Nikolai Ceasescu. But nothing quite matches for crassness the photograph of a deferential Bond shaking hands with General Augusto Pinochet, preparatory to acquiring Chile’s privatised telephone monopoly in August 1987. ‘You feel safe on the streets and it’s the best economy in Latin America,’ said Bond; the generalissimo’s serial human rights violations and massive money laundering were apparently just the price of progress. How piquant that the fates of both Bond and Pinochet should involve them staving off justice with claims of frailty and forgetfulness.
The rogues, of course, did not go quietly, some even taking out their ire on the system that had previously celebrated them. The Rich List of 1987, for instance, lauded the ‘self-confessed workaholic and fitness fanatic’ Allan Hawkins for having ‘rocketed to the forefront of the Australian and New Zealand corporate scene’. He wasn’t so enamoured of the magazine when editor Robert Gottliebsen wrote the obituary of his Equiticorp group a few months later. Before New Zealand’s Serious Fraud Office sent him to jail, Hawkins complained in his mea non culpa The Hawk:
This guy is a real tit – bald, horse-faced, and with a thin-lipped prissy mouth and an overall expression of extreme self-satisfaction. I don’t know what he does at night because he spends most of his days dreaming. In fact he doesn’t seem to inhabit the same real world as the rest of us…and he’s the sort of bloke who doesn’t let the facts of a story interfere with a chance to increase the magazine’s circulation.
Not every brush with the law leaves a reputation permanently stained. Developer Albert Scheinberg was caught in the same Fitzgerald Inquiry dragnet that snared George Herscu, but spared jail on grounds of his seventy-nine years. Bruno and Rino Grollo have lived down their day in the Supreme Court twenty-three years ago during the trial of Norm Gallagher. In meting out justice to the venal union boss, Justice Waldron described the developers’ conduct in keeping him on side as ‘devious, secretive and deliberately dishonest’ and meriting ‘custodial sentences’. Contemporaries were less censorious, knowing it a cost of doing business in an industry befouled with corruption.
Sometimes, though, corruption is a symptom of a deeper folie de grandeur: witness Tasmanian Edmund Rouse. Vindictive, overbearing, boorish and fond of political incorrectitudes, Rouse stood out all the more for the relative gentility of his state, which he described as ‘a little pimple hanging on the arse end of nothing in international terms’. His ENT Ltd owned the Launceston Examiner, and both Tasmania’s commercial television stations. Yet he despised the press: his idea of an annual bonus at the Examiner was walking through the newsroom each Christmas distributing all-day suckers. And he was contemptuous of the public, claiming to have bought his Rolls Royce for the effect it exerted on pedestrians: ‘In Launceston it makes them spit; in Hobart they throw up.’ Asked once if he would kick an opponent when he was down, he replied: ‘Yes, if I thought he might get up.’
If an opponent remained standing, Rouse employed more emollient means. When the collapse of the Wesley Vale pulp mill scheme in March 1989 tipped Tasmanian politics into crisis, five Green independents agreed to an accord with Labor opposition that cost Liberal premier Robin Gray control of the House of Assembly. Rouse was also chairman of Gunns Kilndried Timber, whose free hand in reducing the state’s forest to woodchip suddenly looked in jeopardy, and he counterstrategised: he would bribe a Labor member to cross the floor. It wasn’t exactly United Fruit in Guatemala or ITT in Chile, and it is hard to know whether the plan was more crude than incompetent or vice versa. He didn’t know his target; he merely theorized that a recent marriage breakdown would make Jim Cox susceptible to financial inducement; he was haphazard also in his choice of intermediary: 3UZ sales executive Tony Aloi had rung Rouse to obtain work experience for a friend, and hung up with a commission to bait a $110,000 lure.
Although the scheme unravelled almost before it had ravelled – Cox went straight to his leader – Rouse was stubbornly impenitent. Defending counsel at his trial, Jack Hedigan, pleaded that Rouse’s public spirit had blurred his sense of right and wrong: ‘It may be, your honour, that the benevolent exercise of power by this man, over a long period of time, may have blunted the perception of what he might, or might not do.’ It was nonsense. Rouse knew his actions were illegal; he simply thought himself above the law. ‘If I were drunk at the wheel and ran down a child in the street, I would suffer incredible remorse,’ he stated in self-justification. ‘But to try and rectify a situation which I believed would be disastrous for Tasmania – and was disastrous – of course I have no remorse.’
Rouse could not even claim credit for the interests he sought so urgently to defend. He had married into ENT’s founding Rolph family – as he explained it, with characteristic felicity, he got his ‘dick caught in the till’. And in inherited wealth, the Rich List has found some of its most dubious characters, as though a sense of entitlement instils a brisk amorality. Larry Adler, another fixture of early Rich Lists, loved his son Rodney – to a fault. Rodney’s recollection, featured in Andrew Main’s Other People’s Money (2002), was suitably grateful: ‘I bumbled through uni, I got through my chartered accounting, I got through my masters, and everyone thought that I was a pretty good mediocre person. Dad thought I would be great. Dad marketed me as if I was great.’ The marketing was so good it persuaded the subject: ‘Do you know what? I rose to meet his aspirations.’ It wasn’t an assessment widely shared. Adler was pungently summed up by his sometime American broker Jeffrey Pokross, a New York Jew with Mafia connections who didn’t bandy words lightly: he was a ‘fucking lunatic’.
Certainly the ASX has received few wackier communications than Adler’s valediction as boss of FAI in January 1999: ‘Dear Sir, Farewell. My tenure as chief executive is nearly over. My life at FAI is at the same stanza in time.’ Its paean of praise to capitalism that read like a Productivity Commission edition of Adam Smith and William Shakespeare: without ‘the invisible hand’, the ‘world as we have come to know it would disappear into a sea of mis-allocated resources’. Invisibility, in fact, was not Adler’s metier. On the contrary, he loomed even larger in the affairs of the company to which FAI had been sold, until HIH capsized in March 2001 with debts of $5.3 billion. Many were dissatisfied by his two and a half year’s jail time. Comedian Vince Sorrenti evolved a joke featuring a gunman with two bullets being confronted by Saddam Hussein, Osama bin Laden and Rodney Adler. The solution – shoot Adler twice – always met with an ovation.
The law fell more crushingly on the Nicholas family, whose wealth cascaded down the generations from the Aspro axis of Alfred and younger brother George. First the descendants of George became mired in a Jarndyce case against their trustees in the Victorian Supreme Court. Then Alfred’s grandson David Nicholas, who had worked his fortune harder than most by introducing first Pizza Hut then Kentucky Fried Chicken to the country, fell spectacularly among thieves.
In the hothouse of the 1980s, David Nicholas was a hybrid, establishment roots topped with exotic branches, housed in Toorak and Portsea, but married to his beautiful Swedish stepsister, moving in the circles of both Alan Bond and Christopher Skase – and beginning to learn some of their habits. His first brush with the law was when the junior miner Mid-East Minerals whose board he chaired was rumbled warehousing shares in Metals Exploration: he was fined $40,000 and banned from holding a directorship for five years. His investment company Asiatic Pacific then squandered money on an investment in handcrafts, and Nicholas began topping up his finances by less orthodox means. When Asiatic Pacific collapsed in March 1988 with an $8 million deficiency, it emerged that he had bilked AGC of $2.2 million with fraudulent invoices for plant never built and equipment never bought. By June 1990 he was beginning a four-year term for fraud. ‘Hopefully that will be the last chapter in (his) public humiliation,’ said his counsel, with misplaced optimism.
Although the sentence was reduced on appeal, and he served fourteen months, David Nicholas did not savour freedom long. In September 1994, he and a Chinese business associate Lu Cjun Khe collected a bag from a contact at South Yarra’s Hotel Como. The bag contained 8.4kg of heroin worth $12.5 million – enough, a few years earlier, to have won you a place on the Rich List on its own. But also tucked away was a listening device, while the contact himself was a Thai nark working with the AFP. Spectators at the trial struggled to reconcile the calm, courteous, well-spoken son of privilege who claimed mildly to have been in the wrong place at the wrong time with the desperations and deceptions of the hard drug trade, but the jury did not hesitate to convict nor the judge to impose a sentence of fifteen years.
If no family is without its dirty laundry, only one in the Rich List’s history has chosen to hoist it on a flagpole. But then, Douglas Moran has had a habit of saluting himself regardless. He wrote to BRW welcoming its innovation in 1983: ‘I firmly believe that Australia’s prospects for greatness and recognition in the world rest entirely with those in the country who take risks and generate wealth.’ Just how firmly he held that belief was illustrated in the instance of his son Brendan, who took ninety minutes to asphyxiate himself with carbon monoxide in a car in the drive of a North Epping house in February 1995.
Gentle, weak, troubled Brendan had been steadily and fastidiously disowned by the Morans, to the extent that he was sent a copy of a BRW profile of the family with the notation: ‘Notice you didn’t get a mention…Loser!’ When Brendan’s widow Kristina began a legal crusade to be compensated for the mental and physical cruelty inflicted on her late husband, the patriarch, who insisted on his children calling him ‘Mr Moran’ or ‘Chairman’ at work, dismissed it as ‘simply blackmail’. Perhaps he should have paid anyway: in court he emerged as the poster father of psychological sadism.
Read one letter: ‘You may like to consider the serious consequences that sheer stupidity can lead to…Your extravagance continues to lead to trouble. Unfortunately I believe it cannot be cured.’ Read another: ‘Your lack of discipline has been tolerated for some time with my expectancy that you should grow up…Your continued insistence that that you have been hard done by is difficult to understand.’ And finally: ‘Those who do not dedicate self-discipline and willingness to work and pull their weight end up being losers…No further financial support of any description will be made available to you both, nor do we accept any verbal or written response on your family affairs.’ At the time of Brendan’s death, it emerged, Douglas was sueing to recover for costs of a house his son had considered a gift.
That was not the family’s only dysfunctional relationship. Brendan’s brother Peter Moran, a violent man who came under a restraining order for bashing a teenage relative’s head on a concrete pavement, had taken sibling rivalry to a new level when they worked together in the family real estate business. In one dispute around Christmas 1990, Peter had beaten Brendan brutally, and bitten his finger through to the bone; in another around August 1993 he had rendered Brendan unconscious by strangling him with his tie. According to Kristina Moran, Douglas’s wife Greta had urged her to use make-up to cover the scratches and gashes on Brendan’s face and neck. And the Moran parents, said Kristina, were used to giving orders and having them followed: ‘You’re told where you’re going to live, what car to drive, where your children go to school. It was not unusual at all.’
Towards the end of the sensational court hearings, it transpired that all was not as it seemed with Douglas and Greta either, in spite of their cloying hand-in-hand arrivals each morning. She was revealed to have undertaken electro-convulsive therapy in 1984 to deal with her depression, and to have sought advice about a divorce six years later. A letter from her to Douglas presented in evidence described ‘bashing’ which had ‘become a habit’ and ‘verbal abuse – absolute filth and obscenities…meant to humilate me and as vulgar as were the physical bashings’, although worse still were the ‘ultimate humiliations of your extramarital affairs’ which were ‘common knowledge’.
Considering that you enjoy mentioning often having risen from humble beginnings and being justifiably proud of it, so many people would be delighted to hear of your present behaviour with a woman whose character leaves so much to be desired, showing that all your achievements have been only reasonably lucky and that the character that you have been showing publicly is a sham, that the real you is back to your original standards.
Case notes presented by a Northside Clinic doctor who counselled Greta in July 1993 gave a clear prognosis: ‘To put it very mildly, the relationship with her husband is catastrophic. I think she has the option of going on as it is and probably dying from hypertension or doing something about it. She is very reluctant to face reality.’ This last observation was verified when the matriarch was examined by Kristina Moran’s barrister: Greta had simply forgotten it all. The family commenced to do something similar when the case was settled soon after. To Douglas, the proceedings meant only one thing: further evidence of Australian disrespect for the enterprise spirit.
[The court case] disappoints me as an Australian. Friends in the US have said to me, ‘Doug, if you were over here in the States, what you’ve done, where you have come from, you would be highly respected’. But we don’t want that here…People say, ‘Let’s shoot him down’…We will kick on. It’s a great family, dedicated to nursing care. So we will win.
All of which recalls another oft-quoted line concerning wealth, F. Scott Fitzgerald’s about the rich not being ‘like you and I’. For there are times when it seems fervently to be hoped.