Trump went cool on Sydney casino as cops concluded mafia report

Donald Trump began to publicly air doubts over his Sydney casino bid around the time of a secret NSW police report.

Donald Trump owned two casinos in Atlantic City.

Donald Trump began to publicly air doubts over a bid to build and operate Sydney’s first casino around the time a secret NSW police report warning of the now-US President’s “mafia connections’’ had been finalised.

The billionaire, who then owned two casinos in Atlantic City, abruptly cancelled a trip to Australia in April 1987 and flagged his waning enthusiasm for the Darling Harbour project as the NSW government was about to consider the damning report into the suitability of his joint venture.

The NSW Police Board cautioned the Unsworth Labor cabinet that it would be “dangerous’’ to go ahead with Mr Trump’s joint venture with the Queensland-based Kern Corporation.

It was revealed in The Australian yesterday that on May 4, 1987, the NSW cabinet rejected Mr Trump’s bid on the back of the police report.

Only months before, Mr Trump had established a $100,000 shelf company — Votraint No 270 Pty Ltd — with Kern Corporation boss Barry Paul, and was planning to visit Sydney to lobby for the ­casino project. One of his staff had been sent to work out of the Kern Corporation’s Sydney office, and several Australian executives had been given tours of the Atlantic City operations by Mr Trump’s then wife, Ivana.

But on April 20, 1987 — in a hearing to renew a casino licence before the New Jersey Casino Control Commission — Mr Trump played down the joint venture. He told the hearing he had only signed a “very preliminary agreement’’.

“It was really an agreement to go in and bid and to work everything else out later, essentially.”

Mr Trump then told the hearing he had just cancelled his trip to Australia. “I was supposed to make a trip there a week and a half ago, and when I heard it was 26 or 27 hours (flight) — I actually knew it but it was planned for three or four weeks,’’ he said. “As the time got closer and closer, it sounded more and more less attractive.

“So I don’t know whether my enthusiasm level can be very great for that particular job. It’s just a long, long trip away. I believe on very hands-on management.’’

Australian executives in the joint venture have told The Australian that they had to undergo ­extensive police checks, and that their US partners were also facing the same scrutiny.

The NSW Police Board report was finalised in early April 1987 and then handed to the government. Cabinet minutes from May 4, 1987, contain a summary of the Police Board’s position and show it considered the Kern/Trump bid to be unacceptable.

“Atlantic City would be a dubious model for Sydney and. in our judgment, the Trump mafia connections should exclude the Kern/Trump consortium,” the report concluded.

Sydney lawyer John Kehoe, a director of the joint venture company who met Mr Trump several times in New York about the bid, yesterday said the businessman was serious about the Sydney ­casino. Mr Kehoe said he had been personally unaware of the report’s findings and agreed that Mr Trump’s cancellation of the Australian trip could have been because he had heard he would not get the licence.

“He was very keen, in fact he had arranged to come out here with Ivana and I had booked the presidential suite at the Regent and helicopter rides for Ivana and her team,’’ Mr Kehoe said. “I’d ­organised a dinner with Mary Fairfax and a lot of Australian business people. But he decided at the last minute not to come.”

Former foreign minister and NSW premier Bob Carr, who was minister for planning in 1987, said the police report was the decisive factor. “It would be very funny if I was still the foreign minister dealing with the Trump administration having been part of a cabinet that decided he was not a fit and proper person to own and operate a casino in Sydney,’’ he said.

“The police reports were the final word for us. The Trump proposal was just a no-go.”