Judge puts Clive Palmer’s case back in the hands of police

Clive Palmer is in limbo. He has been neither cleared nor potted over serious allegations of fraud.

Judge David Jackson’s decision to sidestep the question of whether Palmer acted fraudulently and dishonestly when he took more than $12 million in Chinese funds means it is likely to be left to police to determine.

The problem for Palmer is that Jackson did go on and make a number of conclusions that look bad for the tycoon.

This cash was meant to have been spent on a port. Palmer knew that. It was part of the deal. It was funnelled instead to pay for his political creature, the Palmer United Party. He signed the cheques.

The evidence of the money trail has never been in doubt. After Palmer took $10m and dropped it into his company, Cosmo Developments, there were cheques of: $6m to the Palmer United Party; $799,000 and $1,247,844 to its advertising agency Media Circus; $250,000 and $300,000 to his company, Mineralogy; $97,348 to pay an Amex bill; and $233,352 to pay for a trademark application for Blue Star Line for his Titanic dream.

A further $2.167m was siphoned weeks later, in September 2013, which also went to Media Circus to pay for the widespread advertising that helped deliver electoral success to the PUP. None of this was for a port.

As a result of Jackson’s judgment, Palmer’s legal argument that the Chinese funds were not held “on trust” by him or his company has been upheld. That is his win. Having found there was not an actual trust, Jackson decided he would not need to rule on whether the parliamentarian had acted dishonestly and fraudulently in taking and spending all the cash. That was another win.

While Jackson avoided making such a declaration, however, he spiked his judgment with details adverse to Palmer. He described Palmer’s “apparent attempt to manufacture evidence to show that there was a written contract” to authorise his withdrawals. The judge appeared unimpressed by this purportedly “sham document”, which was allegedly fraudulently pulled together and backdated — a work of fiction that Palmer eventually abandoned as part of his defence. According to Jackson, “the unexplained creation of an apparently false contract of that kind was always relevant to the (Chinese) case”. Palmer knew, too, his $10m payment to Cosmo and $2.167m payment to Media Circus were not authorised, Jackson ruled.

The serious accusations of fraudulent conduct that were levelled against Palmer by the Chinese were not unjustified, according to Jackson, who found they had a “reasonable basis”.

Jackson called out Palmer’s persistence “in an apparently unsustainable and possibly deliberately false plea (that his company) had made the challenged payments for an authorised purpose” for port services.

The upshot now is that Palmer may (or may not) have taken China’s money fraudulently — we don’t have a ruling either way because Jackson preferred to duck it. He decided that “such findings could cause significant reputational damage” and were not needed to resolve the liability questions. Jackson was also concerned that the Chinese side might have wanted to “embarrass” Palmer. That would be understating what the Chinese would like to inflict on the federal member for Fairfax.

Some will be scratching their heads after the narrow outcome of these civil proceedings. A wealthy politician helps himself to millions of dollars, spends it on private interests unrelated to a port, and allegedly “manufactures” a document after the fact to justify the withdrawals. Then he pays the money back — and says he did nothing wrong. Does it pass the sniff test. It falls to police to clear it up once and for all.