The Free Enterprise Foundation, Michael Yabsley and Arthur Seenodonors

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"I know nothing!"

Former Liberal Party money man Michael Yabsley has put Arthur Sinodinos in an untenable position by belling the cat on what he knew about illegal developer donations. Managing editor Dave Donovan reports.

EARLIER THIS WEEK, a former Liberal Party official admitted to committing a criminal offence by concealing illegal acts committed under his oversight.

At least, that was the way it appeared when the Liberal Party's former federal treasurer, Michael Yabsley, told ABC Four Corners he was aware of illegal donations being made to his Party during his time in charge.

Yabsley was asked whether he knew prohibited donors were being asked to give money to the Liberal Party’s notorious Free Enterprise Foundation, so it could be funnelled illegally to the NSW branch.

He replied:

“I don't think it was a great secret about the fact that that was happening. In a couple of cases, yes. We're talking about property developers, owners of certain licensed premises. I don't think it was a great secret about the fact that that was happening.”

So, he knew a crime was being committed, but he did nothing about it. Isn’t that a crime itself?

He was also asked whether, as the Party’s federal treasurer, he was concerned about the Free Enterprise Foundation and what it was doing:

“… not specifically. And, and I think what gave rise to being somewhat sanguine about it was the practice that had been going on over many, many years, where donations were made through the Free Enterprise Foundation and declared as contributions from the Free Enterprise Foundation.”

He was sanguine about it. Sanguine. How nice.

It was standard practice, apparently, for the Liberal Party over “many, many years” to filter gifts from illegal donors through this sham charity.

Yabsley was specifically asked whether he thought these donations were lawful:

He replied:

“It struck me as being something that had been happening over a long period of time and, you know, there was no particular reason to suggest that it was unlawful in a way that was different with what had been done in the past.”

He didn’t say it was legal, you’ll notice. Just that, in his mind, the practice had attained a sort of de facto legality because, well, that was just the way it was — the way things had always been done.

Shades of the Nuremberg defence. The banality of evil.

He confirmed his negligence and complicity in the same interview, when he said:

“Now, looking back on it, you know … what's arisen in NSW in the context of the ICAC inquiry, those practices are not acceptable and should not have been acceptable in the past.”

What is wrong with these people, that they are unable – at the time − to see the difference between a crime and a legal act? Between right and wrong?

In any case, neither ignorance − nor ignorance of the law − is any excuse.

Despite Yabsley’s haughty, self-serving comments about it “really is high time to do something about this”, he would appear, on the face of it, to have committed a crime and so should be prosecuted — or, at the very least, be obliged to disclose all he knows about these corrupt practices and who else was involved, or else be faced with the prospect of incarceration.

More importantly, the comments of Michael Yabsley now make the position of scandal-prone Cabinet Secretary Senator Arthur Sinodinos utterly untenable. He must now resign — preferably from Parliament altogether.

Consider. Michael Yabsley was the Party’s federal treasurer and he not only knew about these illegal donations, but had known about them for “many, many years”. He added that it was no “great secret” they were happening.

Arthur Sinodinos, meanwhile, was the NSW Liberal Party treasurer during the period in question — NSW, of course, being the very state in which developer donations are illegal. Also, astonishingly, at the same time he was chair of one of the entities, Australian Water Holdings, which was making these illegal donations to the Liberal Party. Despite all this, Sinodinos denied countless times, under oath, at the NSW ICAC to having any knowledge of these prohibited donations.

It simply doesn’t add up.

"But he could just be an idiot," you might suggest.

Yes, but Sinodinos was also the long-time chief of staff for former Liberal Prime Minister John Howard. That is surely not the job a numbskull could inhabit. And, indeed, colleagues line up to lavish praise upon Sinodinos for being such a gifted and skilled operator.

Prime Malcolm Malcolm Turnbull had this to say about Sinodinos upon elevating him to cabinet secretary:

“The gold standard of good Coalition cabinet government was during the Howard government. Arthur was at the centre of that as John Howard’s chief of staff.”

He was the "gold standard" chief of staff. Not some forgetful moron, who couldn't find his head if it wasn't screwed on.

Of course, being the chief of staff to a Liberal Prime Minister would also entail having detailed knowledge about where all the Liberal Parties bodies are buried. The thought that Sinodinos would not know where the NSW branch was getting its money from simply defies credulity.

And it beggars belief that Sinodinos did not perjure himself when he stood up at ICAC and denied, scores of times, having any knowledge of the illegal donations to the Free Enterprise Foundation.

He lied, it seems assured. And he lied knowingly.

And so he must resign. And he must be investigated by the police for possible corruption. And he must tell the police what else he knows, honestly, without his typical prevarication, evasion or obfuscation.

Of course, Yabsley and Sinodinos represent the merest tip of the iceberg. Four Corners on Monday night showed that the money for favours culture runs deep in Australian politics. Michael Yabsley deserves no plaudits for finally coming clean about the criminality that occurred under his regime, which he did nothing to stop when he had the chance. And Arthur Sinodinos deserves nothing other than contempt and condemnation for his continued hollow, implausible denials.

And anyone who now suggests we do not need a Federal ICAC as soon as practicable must themselves be treated with extreme suspicion.

You can follow managing editor Dave Donovan on Twitter @davrosz.

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