Ex-Liberal staffer Timothy Koelma admits lying to ICAC over campaign slush fund

Timothy Koelma admitted giving false evidence to NSW’s corruption watchdog over a series of hearings.

Timothy Koelma outside the Independent Commission Against Corruption.

An ex-Liberal party staffer found by the ICAC to have used a slush fund to help “wash” illegal political donations from property developers has made an 11th hour confession that he lied to the corruption watchdog.

Timothy Koelma, a former adviser to disgraced ex-NSW energy minister Chris Hartcher, was due to face trial in a Sydney court on Monday after pleading not guilty to three counts of knowingly giving false evidence to the Independent Commission Against Corruption during a series of hearings held in 2013 and 2014 as part of its inquiry into illegal donations during the 2011 state election campaign.

However, the one-time political player sensationally changed his plea to guilty late last week during a last-minute mention of his case ahead of the trial.

A set of agreed facts tendered to the court said Koelma established a business called Eightbyfive in 2009, which was later used to funnel thousands of dollars of prohibited donations from property developers into Liberal party coffers under the guise of consulting and lobbying.

In its 2016 report, the ICAC found money channelled through the company was used to benefit the party’s Central Coast candidates, including Mr Hartcher, the incumbent for Terrigal, along with Christopher Spence and Darren Webber, who were subsequently elected to the seats of The Entrance and Wyong respectively.

Timothy Koelma outside the Independent Commission Against Corruption.

The agreed court facts said the scheme was uncovered in March 2012, when Matthew Lusted, the director of property developer LA Commercial Pty Ltd, contacted the Liberal party querying why a donation he made to the campaign had been banked by Eightbyfive.

The party referred the matter to the Electoral Funding Authority, sparking an investigation which spawned a three-year corruption inquiry and resulted in almost a dozen MPs being sidelined or quitting politics altogether.

Koelma was once an adviser to former New South Wales energy minister, Chris Hartcher.

The court heard Koelma was questioned at private and public hearings in 2013 and 2014 about the nature of $12,200 worth of payments made to Eightbyfive by three property developers.

Koelma claimed a $5,000 payment from LA Commercial was for advice he’d given Mr Lusted regarding “planning matters”, “planning and development in Wyong” and Mr Lusted’s plans to run for preselection for the seat of Dobell.

However, Mr Lusted told the ICAC he’d never met Koelma and it was another of Mr Hartcher’s political staffers who had solicited the donation from him on behalf of the party.

That staffer confirmed Mr Lusted’s account and told the inquiry he had instructed Koelma to issue the invoice to LA Commercial from Eightbyfive, despite knowing the money was a donation to the party.

Matthew Lusted was the person who reported the irregular donations to the Liberal Party. Picture: Sue Graham

Meanwhile, Koelma gave similar explanations for $5,000 and $2,200 payments from developers Yeramba Estates and Crown Consortium, respectively.

Representatives from both companies refuted Koelma’s claims when giving evidence at the inquiry.

Neither Mr Lusted, LA Commercial, Yeramba Estates, Crown Consortium or any of their employees were the subject of any adverse findings by the ICAC and the Telegraph does not suggest any wrongdoing on their part.

The ICAC subsequently found Koelma had lied during the inquiry and recommended the Director of Public Prosecutions take action against him, resulting in charges being laid in December 2020.

Mr Hartcher resigned from the NSW government cabinet in December 2013 after the ICAC raided his office but continued on as Terrigal MP until retiring at the 2015 election - almost 18 months before the ICAC released its report.

Timothy Koelma continuing his evidence. The Independent Commission Against Corruption (ICAC) was established by the NSW Government in 1989 in response to growing community concern about the integrity of public administration in NSW.

The report recommended the DPP consider prosecuting Mr Hartcher for larceny. He has not been charged.

Meanwhile, the ICAC found that Mr Spence and Mr Webber acted at the time “with the intention of evading election funding laws”, but in January 2017, the NSW Crown Solicitor released a statement dismissing the ICAC accusations against the pair and stated there was “insufficient evidence” that donations were from prohibited donors.

Koelma will face sentencing next year.