Sydney’s many tribes share the same spaces but they operate under different rules. There is no place where this contrast is clearer than that little triangle of land caught between the abrasive commerce of the city to the west, and the pervasive criminality of Kings Cross to the east, known as Woolloomooloo. In April 2004, three separate stories of Sydney would briefly intersect, brought together by networks and a coincidence of geography. Yet while the stories would overlap, the players themselves would remain worlds apart. It began on a fine autumn day in 2004, when the networkers dining at Otto Ristorante realised with a start that they were not alone. The Department of Immigration and Multicultural and Indigenous Affairs had descended on the Finger Wharf. It was an awkward luncheon moment.
Ros Reines reported the raid in the Sunday Telegraph several days later, on April 27. Two Otto staff from Sri Lanka, both long-term members of the celebrity kitchen team under chef James Kidman, had overstayed their visas and were carted off to Villawood detention centre. A whiff of intrigue hung about the tale. Reines said authorities had mounted the raid on the basis of ‘information received’. It came just days after Lang Walker and Mr Golden Tonsils, John Laws, had completed buying Terzini and his original backers out of Otto, pumping in another $1.4 million of capital. Was this trouble in paradise? Or did DIMIA just have a thing about Woolloomooloo?
The raiders were a DIMIA team that specialised in restaurants and brothels. In February, the target had been massage parlours in Newtown. In early April, it was restaurants in Marrickville. Three weeks after the Finger Wharf affair, Immigration Minister Amanda Vanstone’s finest were rousting out the Doyles seafood restaurants at Watsons Bay and Pyrmont, with a couple of keen minds from the Daily Telegraph in tow to watch as eleven staff were rounded up and escorted to Villawood. A day later, it was a massage parlour in Bondi, where four young women were soon helping DIMIA with their inquiries. The ‘Daily Terror’ boys, who tagged along on that expedition as well, held nothing back when it came to writing up their scoop. Under the headline, ‘Exposing Sydney’s sex slave traders’, the Terror told a poignant story about Jade, a young Korean woman caught in the Bondi raid, weeping in the bare DIMIA holding room.
‘I have never worked in a place like that before,’ Jade sobbed. ‘My family will kill me if they find out I was working in a brothel. Please don’t print my picture in the paper because I’m scared they might find out what I have been doing here. They will be ashamed of me.’
Getting these quotes was no mean achievement. It emerged later in the Migration Review Tribunal, where the affair ended up, that the four Korean women spoke little to no English and no interpreter had been present. The truth was that the massage parlour wasn’t a brothel and the young women weren’t prostitutes—just very frightened young tourists who mistakenly thought the immigration officers guiding the journalists were threatening them with guns. In fact, it looked as if someone with an overactive imagination had invented the entire Daily Telegraph story. The Australian was the only paper sufficiently interested in the women’s fate to reveal their total innocence. For people at that end of town, did it really matter?
Thankfully, back at the Finger Wharf, sanity quickly returned. By 23 April, the Friday lunch crowd was tying on their bibs at Sydney’s favourite restaurant for another round of nuova cucina, and all seemed as before. When Terzini opened Otto in 1999, he had looked at the outside view of naval dockyards and the clutter of boats and wisely decided to make this an inside restaurant. As a little joke, he made the mood lighting so dim that, unless you bag a table on the balcony, the only place to be seen in Sydney can require a torch to find your table. Lesser restaurateurs might have written the menu in braille. Yet, even as service resumed as normal at Otto, it was hard not to feel the faintest twinge of doubt. A good kitchen team is a tight operation and it relies on four or five experienced sous chefs. Could you really remove two key players—say, by arresting and deporting them— without affecting the fine timing required for searing the herbed loin of tuna, the mix of flavours required for quail saltimbocca with poached pear, or the guancia di vitello, the slow braised veal cheeks? Had the immigration minister really thought this issue through before she despatched her hearties on to the Finger Wharf, the A-list asked itself seethingly. Indeed, what was Amanda Vanstone’s position on veal cheeks?
Lang Walker, the proud new co-owner of Otto, had more pressing matters to attend to. On 23 April, as the two Sri Lankan sous chefs in Villawood were confronting the inevitability of their compulsory homeward flights, Lang Walker was contemplating a little offshore travel of his own. It began with a board meeting at ten minutes past two in the Walker group boardroom on Level 10, 1 O’Connell Street. Walker Corporation was finalising a $28 million loan from the ANZ Bank to fund part of its giant Rhodes development in Sydney’s inner west. But there were other matters for consideration.
Four days earlier, the Supreme Court had ruled that Walker Corporation was entitled to compensation for land the state government had compulsorily acquired at Ballast Point on the Balmain Peninsula. While the court hadn’t yet decided quite how big the payout should be, nine-figure sums were being bandied about. So it was interesting timing that one of the matters that the board discussed on 23 April was a proposal to send a $100 million payment to a company in the British Virgin Islands. Walker does not comment on his private business affairs and international financing arrangements are notoriously difficult to follow. However, from an outsider’s standpoint (and whether or not this was what he actually intended), it looked like Walker had the perfect mechanism, when the cheque for Ballast Point eventually came in from the state government, to ship money offshore to a tax haven. There is no suggestion that any of this was improper. It merely reflected the way the Walker Corporation had set up its finances, which showed a paper trail of half a billion dollars in funding from Monaco and the British Virgin Islands.
Walker Corp’s share structure seemed quite straightforward. There were twenty-four ordinary shares, all of them owned by Lang and Suzanne Walker, and fifty redeemable preference shares, which were owned by a related company called Bay Street Finance (BSF). But behind this it was more complicated. Corporate filings from 2004 show that BSF had borrowed $340 million from Athenaeum Investments Ltd, a company that was said to be based in Monaco. In addition, another company with a similar name, Athenaeum Investments Pty Ltd—based in the British Virgin Islands—owned $169 million in redeemable preference shares in BSF. The upshot of this was that the Walker group owed $509 million to whoever owned the Athenaeum companies. Repayments of loans and preference shares do not attract tax.
There’s nothing necessarily wrong with any of this. It’s smart tax accounting. The arrangement appears to have been set up several years before, when Walker was bidding for a development project in Paris. In fact, it was while Walker was focused on his French plans in 2001 that trouble arose back home over his plan to buy the old ICI chemical plant at Ballast Point and turn the site into townhouses. The proposal proved hugely unpopular, triggering a wave of public indignation about the loss of public access to this foreshore. Paul Keating was scathing about Walker’s development record. ‘The Finger Wharf is the most cynical and undemocratic development of its kind that Sydney has seen,’ he wrote in 2000. ‘It represents a new low in the processes of planning and consent . . . If we were after a symbol we missed it; instead we got a memorial to Lang Walker.’ The furore prompted Premier Bob Carr to announce that the state government would compulsorily acquire the Ballast Point land. Of course Walker did the decent Sydney thing, which was to sue for damages.
The case had gone very well. Walker Corporation had only ever paid a 10 per cent deposit on the site, a matter of $1.5 million. On 19 April 2003, Justice Palmer ruled in the NSW Supreme Court that Walker had won and the company was entitled to compensation for all the profits it would have made if it had been able to buy the land and then develop it. The legal argument that followed that week was directed solely to how big Walker Corporation’s compensation cheque from the state government would be. Its lawyers were asking for $100 million.
Big money was in the wind when the Walker Corp board met on 23 April. The new loan from ANZ Bank was complex and involved shuffling money across the group. One of the changes agreed that day was to authorise Bay Street Finance to pay $100 million to Athenaeum in the British Virgin Islands, to redeem some of its preference shares. It may well have been linked to the other changes flowing from the ANZ loan. But the effect was that Walker Corp was preparing to send money offshore just when it had learned about its little windfall from the government.
That was the advantage of working from the business end of the Finger Wharf. While the two sous chefs from Otto glumly awaited deportation, Lang Walker from his penthouse could despatch huge sums of money halfway round the world, before Villawood opened for visiting hours. Three months later Justice Palmer set Walker Corp’s damages payment at a more modest $60 million, less the cost of buying the land. But these were not the only travel stories in Sydney on 23 April. A happier tale was unfolding at a restaurant across town. After six months of self-imposed exile, former Senator Graham Richardson was back, and heading for the meal table.
The scurrilous media reports of that lunch, Richardson would later complain, were completely erroneous. ‘Mate, I’m supposed to have been taken out a back door that I’ve never seen, guided past the Peking ducks by a proprietor I’ve never met, and made my escape up a back alley that doesn’t exist,’ an aggrieved Richardson later claimed. To be clear here, Richardson did have lunch at the Golden Century on Sussex Street in Sydney’s Chinatown with five or six people, and it might indeed have gone on for some time—he was still ensconced well after Lang Walker’s board meeting at 1 O’Connell Street was finished. But Richo certainly did not leg it out the back entrance when he was spotted at about 3 p.m., and he was not assisted in his getaway by Labor Party fundraiser Robert Ho, as was reported by the gutter press. As he made it clear to Sydney’s newspaper editors, Graham Richardson is not a back door kind of guy.
It was a welcome return to form by one of Sydney’s legendary lunchers, who in recent years had been spotted ordering white meat and mineral water. Not that the menu mattered. The critical issue was the choice of restaurant. The Golden Century is the watering hole for the power players at Labor House and the Trades and Labour Council, just around the corner. To have lunch there meant that Richo was working his Labor contacts again. He was once more a player.
‘This is the quote you want. I never owned the shares, I never owned the bank account,’ Richardson told me in June 2003; his first public comment since the Offset Alpine/Bank Leumi scandal broke in the Australian Financial Review eight months before. Richardson stopped short of denying he withdrew money from Laira Investment Company’s account at Bank Leumi. He declined to elaborate on his connection with Laira. But the implication was clear. Whatever Rivkin had been up to in Zurich—and Richardson was not saying Rivkin had done anything wrong—it had nothing to do with him. If Rivkin, for convenience, had loaned him some money out of his account, what did that prove? He had not heard from ASIC for months.
‘I was interviewed by them in November or December some time,’ he said. ‘I’ve had no communication with them since then. And I’ve had no communication from Swiss authorities. As you know they searched my house and took away nothing. Nothing.
I did an interview with them. I was, as they say, full and frank.’
How had the last six months been?
‘Unpleasant would do. Bad would suffice. Any of the above. But one keeps going.’
Richardson had dropped out of sight late in 2003 after the Rivkin/Leumi story broke. He cancelled his role as master of ceremonies at Labor Party fundraisers, and he no longer used his office in the Packer building in Park Street. He was said to be taking a vacation, spending time at his five-hectare property near Bowral in the NSW Southern Highlands. But by April, he had quietly resumed his activities as a lobbyist; he said he was working for all his former clients.
‘The only change in my life is I’m no longer on television,’ he said. ‘I’m still representing the same clients.’ The only exception was Packer’s Consolidated Press, where he was on extended leave.
This was where the lunch at Golden Century became significant. Six days later, just before 10.30 a.m. on 29 April, Richardson climbed aboard Lang Walker’s new Falcon 900 jet. He and Walker were running an hour late. They had an appointment in Hobart to see Richardson’s old union friend, Paul Lennon, who had become Premier of Tasmania after the death of Jim Bacon. Walker had a plan for a $400 million marina at Ralphs Bay on the eastern side of Hobart but it had run into some environmental problems. They had finished their Hobart meeting and were back in the Falcon 900 taking off again by 3.35 p.m. Some things don’t take long.
Richardson soldiered on. He stayed off the television (mostly) but kept working as a lobbyist behind the scenes. ASIC had requested assistance from Switzerland on the grounds that it suspected that Rivkin and Kennedy had committed perjury in the 1995 Offset Alpine inquiry. Richardson had not been questioned in 1995, so the issue of perjury did not arise for him. According to Rivkin’s Swiss evidence, Richardson had been party to a breach of the substantial shareholder disclosure laws, but that wasn’t a crime in Switzerland. So ASIC was not able to ask for information about his bank account from the Swiss. However, Zurich District Attorney Ivo Hoppler, who handled ASIC’s request, had wide discretion over what documents he judged were relevant for ASIC’s investigation.
Just before Christmas 2004, Hoppler ruled that twelve folders of bank documents and witness transcripts, which included material about Richardson, be supplied to ASIC. It also contained details for two general accounts of Bank Leumi’s at Credit Suisse. Five parties lodged appeals in the Zurich High Court against Hoppler’s ruling. These included Rivkin, Kennedy, Richardson, Bank Leumi and another unknown party. Leumi complained that it had operated the Credit Suisse accounts to channel money from all of its Australian clients; releasing account records could help identify new names. Richo said he didn’t know what was going on or what was in the documents but he had hired a Swiss lawyer ‘to get to the bottom of things’. In fact, Richardson faced a problem if the documents that ASIC eventually received from the Swiss linked him to the Cheshire and Laira accounts—he had told ASIC in late 2003 that he did not own any Swiss accounts.
In June 2005, the Zurich High Court delivered a fifty-page judgment that confirmed the release of all Hoppler’s documents. The case now went to the second stage of appeal, before the Swiss Federal Court. A decision was expected by late 2005. However, ASIC had also asked to question key figures in the Imfeld saga in Switzerland, including Ernst Imfeld himself. It is not expected to do this until 2006, and the transcripts of these interviews could also be subject to appeals. Meanwhile, the Australian Tax Office was investigating the three amigos.
Trevor Kennedy resigned from all his public boards four days after the federal police raid on his house on 13 November 2003. Life now had a new rhythm for him. Bank Leumi had dropped its claims on the US$500 000 mystery transfer. However, in December 2003, after Swiss reports of the Offset Alpine case, Bank Vontobel froze two accounts operated by Kennedy and Rivkin; they held $4.2 million and $300 000 respectively. Kennedy brought a series of legal actions against ASIC and the federal police, challenging the search of his house, the search of his office, and finally the legality of ASIC’s investigation. By early 2005, he had lost on all counts.
Rivkin resumed his sentence of weekend detention in January 2004, but remained too ill to answer questions from ASIC about Offset Alpine, or from his friends about what he had said in Switzerland. In mid-2004, a long-term associate of Rivkin’s made a brutal assessment of his old friend: ‘Rene is completely buggered. He’s totally broken down. He’s completely not a person. And you can’t have a relationship with someone who is not a person.’ On 2 September, Rivkin’s family found him unconscious from a drug overdose. Eight months later, on 1 May 2005, Rivkin took another drug overdose and put a plastic bag over his head. In midApril Rene and Gayle had filed for divorce and Rene moved in with his mother. It was Rachel Rivkin who found her son dead late on the Sunday afternoon.
In April 2005, Rodney Adler was sentenced to a minimum two-and-a-half years’ gaol and Ray Williams for a minimum two years and nine months, after both men pleaded guilty to charges arising from the HIH crash. Brad Keeling cut a deal with ASIC over One.Tel and by mid-2005 was working with another telecommunications company. Jodee Rich’s civil trial over whether he had misled the One.Tel board was continuing.
Tony Byrne continues his lonely quest to discover what happened to his daughter. On Saturday 7 June 2003, while a procession of media vehicles followed Rivkin to Silverwater gaol, where he spent a night before collapsing, Byrne was on the clifftop at The Gap. It was the eighth anniversary of Caroline’s death and Task Force Irondale was staging a reconstruction of the fatal night in the hope of coaxing out some last clue.
In February 2004, Inspector Jacobs forwarded the Byrne file to the Director of Public Prosecutions with a recommendation that Gordon Wood be charged with Caroline’s murder. The DPP asked for further tests. Meanwhile, the Australian tracked Wood down to the French ski resort of Mageve, where he once claimed to co-own a chalet. He disappeared once more, though his friends said he still kept in touch.
‘He used to phone me quite frequently,’ said one former fellow-worker in Britain. ‘He’d say, “I can’t tell you where I am, but I’m sitting in a cafe in the sun.”’
Paul Makucha had fallen on hard times once more. ‘I give up,’ he told me in a stricken telephone call in late 2004, when creditors were threatening him with bankruptcy. ‘I don’t drink and I don’t smoke and I’m not prepared to do the things you have to do to get by in this town.’ He contemplated bankruptcy. But by the next morning he was back up again, vowing to fight on. In January 2005, he left The Toaster and moved back into the ‘Shithouse Hotel’, the shipping container at the airport in which he had lived for five years during the 1990s.
After his attempt to mount a private prosecution of Westpac had been taken over by the Director of Public Prosecutions and no-billed, Makucha was now in trouble with a $12 million loan he had raised for a new billboard site. He had borrowed this money from Brian Merritt, a former printer who had sold his business to Helena Carr in 1993, the year after she missed out on buying Offset Alpine. Merritt had retired to Bowral and now styled himself and his wife Lord and Lady Merritt of Caynham Garden, an English title which the Sydney Morning Herald reported was unfamiliar to the folk at Debrett’s Peerage. Makucha claimed in a court case that Merritt had paid $100 000 for the title. Merritt’s lawyer said his client did not wish to comment on his private life.
After Makucha had obtained a $50 million valuation for his proposed development, his refinancing fell through and Merritt appointed a receiver to Makucha’s companies in late 2004, just as Makucha was hit by a series of court orders obtained by trade creditors. It was while representing himself in one of these cases that he had his run-in with magistrate Pat O’Shane and found himself in the holding cells. This was probably his lowest point, though he later rallied. It would take more than this to knock out Paul Makucha. By late 2005 he was slowly pulling his affairs back into shape. In December the Court of Appeal ruled that O’Shane’s behaviour had been ‘quite inappropriate’, that she had denied Makucha procedural fairness and had conducted the hearing in an ‘inappropriately adversarial way’. ‘The exercise by the magistrate of a little tact would have gone a long way’, Justice Hunt found. The judgment that O’Shane awarded against Makucha while he was in the cells was overturned and the contempt charge was dismissed.
Sydney buzzed a little with the news of the great reversals for its favourite sons—for Rivkin, Kennedy, Richardson, Adler, Williams and Rich. The networks that had created and nurtured them were in disarray and for a time the seamy underside of the city’s power structure was laid bare. The rivers of influence and power had taken new turnings. Yet not so much had changed. In the end the city shrugged its shoulders and went on with its business, as blasé as ever. The tragedy of Rivkin was that he feared that there was no way back for him, that the shame of his disgrace was overwhelming. But Sydney has never been quite so definitive in its judgments.
In mid-2005, in a year already scored by calumny and grief, the unthinkable finally happened. The blow fell just after two o’clock on Tuesday 5 July as across the nation’s business districts the lunch crowd finished their mains, eased back on their napkins and turned their minds to dessert and coffee. In Sydney, Machiavelli had the reassuring buzz of a kitchen at full stretch when James Packer, PBL chief John Alexander and Crown Casino head Rowan Craigie dropped by for a late bite. No fewer than three newspapers reported the next morning on the unhappiness that followed. Machiavelli’s front room was full. Every seat was taken and even Giovanna Toppi could not instantaneously conjure a table out of thin air. As her best client kicked his heels, staff were reduced to hustling an unused table along the corridor from the Queensland room at the back and hurriedly setting three new places. The table that the waiters finally produced was entirely serviceable, indistinguishable from any of the other settings in the power circle. But at Machiavelli, Queensland is a state of mind. The unpalatable truth was that Packer’s table, that sure bedrock of social certainty for the 1990s, was no more; its patron transformed into a mere diner. It was a triumph for the suits. As if these were not indignities enough, in the hiatus while the maitre d’ was whistling up cutlery James wandered across the room to chat idly with a familiar face: a more fortunate diner who had managed to snare his regular table, underneath his own photograph. It was a genial Graham Richardson, tucking into the prawn cutlets.
Something more than a botched lunch date seemed to be at stake here, judging by the speed with which diners gleefully recounted the incident to journalists at the Australian Financial Review, the Sydney Morning Herald and the Daily Telegraph. The seating crisis seemed to signal how much Australia had changed. The last remnants of the Establishment of the 1950s and 1960s based upon Australia’s institutions and inherited wealth had slipped away unnoticed some time in the 1990s. The network which had taken its place in the 1970s and 1980s was also failing, the system of social ranking and power which had evolved during those decades slowly unravelling. Something more than bad luck had caught up with our heroes. These men who rode the wave of the deregulation money boom in the 1980s had survived the 1990 recession and were remarkably successful in building new fortunes, but their hold on power was slipping. Even the Packer name, while it continued to hold enormous weight, was not quite the unassailable colossus it once was. The future belonged to the Macquarie Bankers, the Babcock and Browns, the Colonial First Staters and the endless legion of fund managers, McKinsey consultants and financial neocons. Their ranks are filled with younger analysts and executives who know nothing of the 1970s and 1980s, for whom the turbulence of those decades was an anachronism, a blip which preceded the second coming of the institutions, along with all of the social and ideological baggage which such a change carries.
This is not merely a change in stakeholders at the big end of town. It is a change again in the way we live. A universe of technological advances and personal diversity is producing, paradoxically, a new conformity. For all its promises, in some respects economic deregulation has delivered a leaner, meaner version of the 1950s. What it shares with the earlier era, along with the new prosperity, is an underlying sense of disquiet. So we return to nervous policing of our borders and fretful subservience to our allies; to a paternalistic government with a natural right to rule which makes comfortable decisions behind closed doors with those whom it favours. How else could a prime minister say, to universal acceptance, that he was only willing to change media ownership laws when the existing power players had decided how to carve up the spoils? How did the aspirations of government come to correspond so overtly with the demands of special interest? But the current era has fewer certainties and less generosity; it is more demanding—and far less forgiving—than the 1950s ever were. How sustainable the new institutions will be remains to be seen. Meanwhile the rearguard action continues.
In May 2005, Sam Chisholm was brought back to pull the strings at Channel Nine for the Packers, fifteen years after his celebrated departure. The wheel had turned full circle. But what did it mean? Is this really the last hurrah for the generation born in the shadow of World War II? Age, if nothing else, has winnowed the ranks of this cohort, as the Baby Boomers thrust impatiently for power. Yet the group which has played such a dominant role in Australia for a quarter of a century is resilient. They are used to the limelight, and frankly they’re good at working in it—far better than the new institutional culture that has grown to supplant them. Their passing will leave Australia a drabber place.
Not all is lost. For Sydney loves a show, it craves display and adores a wayward son who has managed to come back into a little money. Rodney Adler judged the town right when he protested that with all his experience he should be going not to gaol but on to the speaking circuit. Richardson always knew that no matter how high the barriers seem for wealth and privilege, there was always room for an ambitious boy from Kogarah with a sense of humour, who knew how to winkle a table out of the most reluctant maitre d’. Thus for a little while longer the pre-Boomers linger at the controls. And so to the ambitious thrusters and earnest aspirers, the consultants, rising stars and brilliant money managers—let all those would-be heirs to the kingdom kick their heels in the anteroom a moment longer, along with the meritholders and the irredeemably worthy, captains in the company of the great unwashed. Your time is not quite come. Ask not for whom the dinner bell tolls. It does not yet toll for thee.