And now it's Australia: Angry US slams bribe denials

Angry US slams bribe denials

Caroline Overington and Geoff Elliott
02feb06

THE chairman of a powerful US Senate committee is demanding Australian ambassador to Washington Dennis Richardson explain the Howard Government's role in the Iraqi wheat affair, saying he is "deeply troubled" by an apparent attempt to cover up the scandal.

Republican senator Norm Coleman, who is chairing the Senate's inquiry into "illegal, under-the-table" payments to Saddam Hussein's regime, also wrote to former Washington ambassador Michael Thawley, criticising him for making "emphatic denials" about AWB's role.
In a letter to Mr Richardson dated January 31, Senator Coleman said he wanted to discuss Mr Thawley's disturbing behaviour during a meeting in Washington in October 2004, where the then ambassador "unequivocally dismissed" claims AWB was involved in making illicit payments to the Saddam government.

Senator Coleman said evidence presented to the Cole inquiry in Sydney suggested that, on the contrary, officials of the Department of Foreign Affairs and Trade may have been "aware of and complicit in the payments of the illegal kickbacks".

Mr Thawley, a former senior adviser to John Howard, used the meeting to argue for AWB to be left out of an investigation into allegations of kickbacks under the UN's oil-for-food program.

The revelation has reignited calls for the Cole inquiry's terms of reference to be widened to include the role of government officials in the scandal. AWB is accused of paying almost $300million to Saddam, and hiding the payments from the UN.

In his letter, Senator Coleman claimed Mr Thawley insisted at the October 2004 meeting that AWB would never be involved in kickbacks. He wrote this week that the revelations in the Cole inquiry were "extremely disconcerting in light of the fact that you came to my office and expressly denied these allegations".

Senator Coleman asked Mr Richardson, who was appointed ambassador to Washington in July last year, and Mr Thawley to contact his committee to explain why the Australian Government had tried to block an investigation into the kickbacks.

He asked Mr Richardson for "an opportunity to discuss this matter" and urged him to contact the staff of the subcommittee.

Neither the Prime Minister nor Foreign Minister Alexander Downer would say whether Mr Richardson would make himself available. Mr Thawley, who is now a private citizen in the US, would not comment.

Senator Coleman's concerns were echoed in a January 30 letter from seven powerful US senators to Secretary of Agriculture Mike Johanns, in which they demanded AWB be suspended from an export credit program.

The senators claimed there was evidence that "senior Australian government officials may have agreed to, or at least had advanced knowledge" of AWB's kickbacks to Saddam's regime.

The seven members of the Senate's agriculture committee also questioned the independence of the Cole inquiry.

"Given the evidence that some Australian government officials may have agreed to, or had knowledge in advance of the illicit payments, is the Cole inquiry sufficiently independent of the current Government of Australia to be entrusted to investigate the matter?" the letter says.

In London, Mr Downer told reporters that he was prepared to give testimony to the Cole inquiry in order to "get to the bottom of what was going on". "I think anybody should be happy to appear," Mr Downer said. "I'm absolutely relaxed about it."

Mr Downer said the Government had established the Cole inquiry after reading the UN's Volker report into corruption, which "was pretty damning".

However, he added that "common sense" supported the proposition that the Prime Minister, ministers and DFAT officials "were not involved in criminal activity, in breaking Australian law and sanctions-busting and approving kickbacks".

Last week, inquiry head Terrence Cole said he was considering recommending many criminal charges after hearing two weeks of evidence from AWB officials.

Treasurer Peter Costello told ABC radio in Melbourne yesterday that Mr Cole had "full powers of a royal commissioner" and would be "calling everybody who is relevant" including government employees.

Mr Costello said Mr Cole was also free to ask the Government to expand the inquiry, adding: "I am sure of one thing: if he makes a request of the Government it will be very carefully considered.