Fraud charges leaves Clive Palmer facing threat of 10 years’ jail

Billionaire former MP Clive Palmer slapped with criminal charges over ‘dishonest’ business dealings, allegations laid out in parliament reveal.

Clive Palmer is facing criminal charges.

Former MP Clive Palmer faces up to ten years in jail and millions of dollars in fines after the corporate watchdog charged him with two counts of fraud.

Australian Securities and Investments Commission senior commissioner John Price listed a series of allegations against the business magnate and one-time MP in an appearance at a parliamentary oversight hearing on Friday.

“Mr Palmer has been charged with two counts of contravening section 408C subsection 1D of the Criminal Code of Queensland by dishonestly gaining a benefit or advantage, pecuniary of otherwise for another person,” Mr Price said.

Each charge carries a maximum penalty of five years’ imprisonment.

Mr Price said Mr Palmer was also charged with “two counts of contravening section 184 subsection 2 of the Corporations Act by dishonestly using his position as a director of a corporation with the intention of directly or indirectly gaining an advantage for someone else”.

Each of those charges carry penalties of up to $25 million for companies and up to $1.05m for individuals.

The former MP will now have to appear in the Brisbane Magistrates Court next month.

“These charges relate to conduct which is alleged to have taken place in 2013 and the matter is being prosecuted by the Commonwealth Department of Public Prosecutions,” Mr Price said.

“For obvious reasons, ASIC does not propose to comment or provide further detail about this matter until the matter is before the court on March 20, 2020.”

The reference to 2013 suggests the charges are likely to relate to Mr Palmer’s business dealings in Western Australia, rather than his collapsed Queensland Nickel refinery.

Mr Palmer’s relationship with China’s Citic, which bought the Sino Iron deposit in WA from him, was deteriorating significantly by 2013. Mr Palmer launched a number of lawsuits against Citic that year, including at least one legal action aimed at forcing Citic to suspend its operations, as the two parties fought over royalties from the mine.

The latest development comes just two weeks after the High Court rejected Citic’s final attempt to overturn a Supreme Court judgment in the royalty dispute. The ruling paved the way for Mr Palmer to collect around $400 million a year in royalties from Citic and the Sino Iron mine, and affirmed Mr Palmer’s billionaire status.

Mr Palmer did not return calls to The Australian late on Friday.

Mr Price also confirmed that Mr Palmer is under investigation over a separate matter, relating to the collapse of his Queensland Nickel company, which went into liquidation in 2016.

The latest development is not Mr Palmer’s first brush with ASIC.

In 2018, the Palmer United Party founder was charged over alleged failures to comply with takeover laws related to his Coolum resort on the Sunshine Coast, which Mr Palmer denies.

It has been previously alleged that Mr Palmer was acting as a shadow director of the business and that he breached his obligations under the law.

Mr Palmer pumped a record $83.7 million into the campaign of his United Australia Party at last year’s federal election but failed to win a single seat.

Mr Price said ASIC was continuing its investigation into other aspects of Mr Palmer’s activities, including his company Mineralogy.

As part of its probe into the collapse of the former nickel refinery, ASIC has issued more than 180 statutory notices for information and had conducted examinations with many people including Mr Palmer and his relatives, former employees of Queensland nickel and external advisers. Queensland Nickel went into liquidation owing its 800 workers more than $70 million.

ASIC is probing allegations that Mr Palmer used the alias “Terry Smith” to run the company as a shadow director, that Queensland Nickel’s money was siphoned into the Palmer United Party, and various alleged breaches of directors’ duties.

Under the law, a shadow director is a person not formally registered or appointed as a director, but who acts as a director of a company and instructs senior officers. Shadow directors have the same duties and obligations as registered directors, and thus can face penalties of up to five years in jail for certain breaches of the law, including for acting dishonestly or in bad faith