Clive Palmer’s side sorry in case over ‘lost’ $12m

CLIVE Palmer’s key lawyer, Michael Dunham, has issued a public apology in a court row that revolves around more than $12m in missing funds.

Clive Palmer.

CLIVE Palmer’s key lawyer, ­Michael Dunham, has issued an apology in a Federal Court row that revolves around more than $12 million in missing funds belonging to a Chinese state-owned company.

Mr Dunham’s sworn affidavit also features an apology from Mr Palmer’s media and public relations manager, Andrew Crook, because of a media release that he improperly issued three months ago in an attack on the company, Citic Pacific.

“I apologise to this honourable court for my ignorance,” Mr Dunham said in a February affidavit that is part of the litigation in the Federal Court involving Mr Palmer’s company, Mineralogy, and Citic Pacific and its subsidiaries.

Mr Crook, director of Crook Group, said: “Now that this matter has been brought to my attention, I wish to apologise for my actions. I did not seek legal advice in relation to this matter prior to issuing the statement.”

Details of the unqualified apologies by two of Mr Palmer’s top advisers come after Mr Palmer suggested on the ABC’s Lateline that Citic Pacific had apologised to him and his company, Mineralogy. Citic Pacific accused Mineralogy last week of wrongfully spending more than $12m of Citic’s money for improper purposes, including expenses relating to Mr Palmer’s party’s campaign for the federal election. Citic has not withdrawn the accusations.

The matters were the subject of confidential arbitration in Brisbane this week, following an airing in the Federal Court in Perth where hundreds of documents with details of expenses and withdrawals were disclosed.

The Chinese company’s top-level concerns about how its money was allegedly siphoned from a Mineralogy-controlled National Australia Bank account and spent on items unrelated to the operation of a West Australian port for iron ore are likely to be referred to police to investigate if misappropriation has occurred.

Yesterday Citic Pacific rejected Mr Palmer’s claims on Lateline including that its allegations and concerns about the missing money were “another make-up by the Rupert Murdoch press”, which publishes The Australian.

In the Lateline interview, Mr Palmer was asked by host Tony Jones about reports in The Australian “that you’ve somehow taken a large sum of money from a fund set aside to manage the (Citic) port facilities in WA and possibly used that to fund your election campaigning”.

“I don’t think I’ve heard your response to those allegations yet. What is it?” Jones asked.

Mr Palmer replied: “Well, it’s certainly scandalous and I can’t say — but there’s always been a resolution of that matter and it’s been pointed out to people and they’ve made the appropriate apology to us.”

Mr Palmer said he was not “aware of” Citic pressing to investigate what happened to the money, adding: “It doesn’t seem to have any substance.”

Asked if the Chinese company had “apologised about this”, Mr Palmer said: “There’s been an apology given and I can’t divulge who it is under the terms of it.”

Citic Pacific issued a statement yesterday in which it repeated its calls for a significant investigation into the missing funds. “Citic notes the comments made (on Lateline) by Mr Palmer,’’ it said. “It was incorrect for Mr Palmer to say that there has been a resolution of the administrative fund matter. Citic has made no apology to Mr Palmer in relation to that matter. As was made clear to the Federal Court last week, Citic considers that a ‘searching inquiry’ should be made into the missing funds. That inquiry is continuing in confidential arbitration proceedings.”

In his affidavit, Mr Dunham explained his conduct in issuing legal proceedings on behalf of Mr Palmer in a bid to wind up the Chinese company, which is controlled by the Chinese government.

The wind-up attempt, which failed, was followed by Citic Pacific’s expressions of concern to Mineralogy about how Citic’s funds were being spent.

Mr Dunham said in his apology: “I have never been involved in insolvency proceedings prior to this and was unaware of any case law” (surrounding the steps that needed to be taken).

The Australian reported last week that Citic’s barrister, Andrew Bell SC, told the Federal Court there was a need for a “forensic accounting exercise” to track down the allegedly missing money.

“When Mineralogy has not been (at the port at Cape Preston in Western Australia), how could they have legitimately incurred and expended around $20m in respect to administration costs?” Dr Bell said.

Affidavits lodged in the Federal Court as part of the dispute between Citic and Mineralogy show that among the allegedly missing funds was a transfer of almost $14,000 out of the Citic-funded port administration account to the Australian Fencing Federation.

The vice-president of the fencing association’s West Australian affiliate is Mr Dunham, who sent a letter to Citic six months later warning the group that it had failed to transfer additional funds into the port fund and was in default.

Under an agreement between Citic and Mineralogy, Citic was required to cover the day-to-day expenses of operating, maintaining and repairing facilities at the Cape Preston port. It was not immediately clear how the transfer to the fencing federation related to those functions.