‘Sale of the century’: The $1 deal and the mayor who knew nothing

When word got out that petrol was being offered for 1¢ a tank, thousands of people piled into their Datsuns, Lasers and Commodores and headed for the dusty little service station at Kemps Creek, west of Sydney.

It was the autumn of 1986. Huge queues formed in the rural lanes around the service station, the police were called to sort out the traffic snarls and happy customers were photographed giving the thumbs up as their tanks were filled. Apparently, no one thought to ask how the humble service station could afford to offer the fuel for free.

Ray Aoude, manager of Wehbe Petroleum at Kemps Creek, offers fuel for 1c per tank in 1986.Credit: James Robert Dallen

The cut-price fuel promotion was the brainchild of Walhan Wehbe, known as Wally, a colourful businessman then at the beginning of his career. A year later, in 1987, Wehbe formed a company with Eddie Obeid that is now at the centre of a growing scandal that has brought together politics, planners, property developers and parliamentary privilege.

It has seen the spectre of corrupt former Labor minister Obeid resurrected, just as NSW Labor readies itself for a state election it believes it can win.

At stake is the multibillion-dollar redevelopment of Bankstown’s entire CBD, packing 12,500 more apartments and many new businesses into two dozen streets, under a plan developed by the council during the tenure of embattled Canterbury Bankstown Mayor Khal Asfour.

Wehbe comes into the picture as the owner of the dilapidated and repeatedly firebombed Bellevue function centre in Bankstown, a site he jointly owned with Obeid and recently acquired in full after paying just $1 to the financial controller of the Obeid family, Hassam Achie.

The Bellevue function centre has seen better days but stands to net its owner a lucrative payday.Credit: Wolter Peters

Despite being on the wrong side of the train tracks that separate it from Bankstown’s main commercial hub, the Bellevue site has been selected as a jewel in the crown of the new Bankstown, earmarked by the council for 25-storey towers, higher than almost all other surrounding structures, and given special status as the location for a “bold form” building. If built, the site for which Wehbe paid $1 could conservatively net him tens of millions.

At issue is whether Wally Wehbe, a generous political donor, was granted special favours, or whether he just got extraordinarily lucky.

The fact that Asfour is an acquaintance of Wehbe, a friend of Wally’s brother Rehme, and held his wedding at the Bellevue with Eddie Obeid in attendance has recently been used against him.

Asfour was picked by NSW Labor leader Chris Minns as a candidate for the NSW upper house in the March election, but in September Bankstown MP Tania Mihailuk, who has a longstanding feud with Asfour, stood up in parliament to link Asfour with Obeid and question the decision to elevate him to parliament.

Khal Asfour, Tania Mihailuk and Eddie Obeid.Credit: SMH

She was sacked from Labor’s front bench by Minns after her speech and then quit the party. The Coalition has seized on the issue, and has flagged it will use its numbers to hold a parliamentary inquiry – similar to the one Labor called into the appointment of former deputy premier John Barilaro to a New York trade job – into the conduct of Canterbury Bankstown Council during Asfour’s time as mayor. The inquiry will likely begin in December, and drag on until February. The election is in March.

Asfour’s position is that despite being elected partly on a platform opposing “25-storey buildings in Bankstown”, he was completely uninvolved in the planning process behind the city’s new master plan, did not attend any briefings and was unaware of what the plan contained until he launched it on March 21 last year.

“I have no relationship with any member of the Obeid family,” Asfour said. Eddie Obeid attended his wedding at the insistence of Mihailuk, who was then seeking Obeid’s help to gain preselection for the seat of Bankstown, Asfour said.

“The Wehbe family is quite a large family,” he said. “If you are referring to Wally, he is a local businessman who supports local community organisations. He is also the proprietor of an Arabic newspaper and my relationship is professional. In relation to Rehme, he is a member of the Labor Party and I consider him a friend who I bump into at functions or occasionally catch up [with] for a coffee.”

Wally Wehbe has acquired a prime piece of Bankstown real estate for $1.Credit: Sam Mooy

The Herald sent Wehbe a list of questions earlier this week, and approached him outside his home on Friday. He declined to comment.

Asfour sits on the board of the local Bankstown RSL club, which is also slated for potential redevelopment under the plan, and said this was the reason he was absent from all briefings and votes during the planning process. To clear his name after the Mihailuk allegations, he has referred himself to the Independent Commission Against Corruption.

Minns is backing his man, saying this week that Asfour’s Obeid connection was historical, and he has seen no evidence of wrongdoing by the mayor.

The battle is damaging for Labor, and not just because it resurrects the spectre of Obeid. Canterbury Bankstown council area takes in the entire state seat of East Hills, which is held by the Liberals on a tiny margin and which both parties want to win at the March election.

Members of the Asfour camp are confident an internal council probe that was called after Mihailuk’s speech in parliament, and which will be reviewed by Arthur Moses SC upon completion, will clear the mayor when it is released in the next few weeks. But, given the council is effectively investigating itself, Asfour’s critics are unlikely to be satisfied by a finding in his favour.

And the critics are circling. In recent weeks, Asfour has been enveloped in a media storm and been outed for failing to declare the purchase of a Melbourne apartment via a trust he jointly owns with his wife, and for charging taxpayers for part of an MBA course he had been undertaking, an arrangement that a fellow mayor said doesn’t “pass the pub test”. Asfour said he had followed disclosure rules and would co-operate with an inquiry into his educational expenses.

The council has also faced questions about transparency. In 2019, it said in a press release that councillors would pay their own travel costs during a trip to America. However, they only paid airfares, and other expenses – almost $150,000 worth – were picked up by ratepayers.

It also had to be prodded by the Information and Privacy Commission to comply with laws requiring a register of councillors’ financial interests to be published online. The commission found its previous policy of requiring people who wanted the information to go to council offices during business hours and fill out a request “is not in keeping with … the GIPA act”, according to documents obtained by the Herald. Council published the information late last month.

When the Coalition government decided in 2014 to include the Sydenham to Bankstown rail line in the city’s new metro link, it also unveiled plans for significant development – including more than 35,000 apartments, with heights of up to 25 storeys – along that corridor, a stretch of the inner south-west which is just 30 minutes from the CBD but is still dominated by family homes on grassy blocks.

With each stroke of a pen on the rezoning map, developers and landowners stand to make millions. That power was initially supposed to sit with the NSW Department of Planning, but in 2018 was given to councils.

The Canterbury Bankstown council’s private record of meetings between developers or their representatives who met with council staff during the planning process, obtained by the Herald, doesn’t mention the Bellevue site or anyone related to it.

The Herald spoke to current and former planning staff involved in preparing the city’s master plan about why the Bellevue site was chosen for a particularly tall tower.

They responded that the planned new metro railway station – with regular fast trains to and from central Sydney – had tended to re-orient Bankstown’s CBD about 150 metres to the east, serendipitously benefitting the Wehbe site.

The Bellevue site has been singled out for a particularly tall tower.Credit: Wolter Peeters

A requirement for commercial space in any future building might mean it was not the most profitable development site in Bankstown, they said.

Wehbe has not responded to questions put to him by the Herald.

The function centre was one of many wealth-creating ventures the enterprising Wehbe family was exploring when it formed the company that bought the site. There was a plan, also jointly hatched with Obeid, to get in on the lucrative live sheep trade with Syria. More investments in real estate, petroleum and childcare centres followed.

An artist’s impression of what the proposed 25-storey developments would look like in Bankstown.

Wally Wehbe’s name appeared in the early 1990s as the operator of a “consulate” in Bankstown for a fictional Caribbean nation named New Utopia – a proposed tax haven to be created by an eccentric US millionaire off the Cayman Islands that could welcome the likes of disgraced businessman Christopher Skase. It never got off the ground.

There were hiccups along the way, such as when a son, Michael Wehbe, was caught by an undercover police officer with a load of stolen mobile phones in the boot of a Mercedes-Benz.

But the family’s fortunes gradually rose. Wally Wehbe developed a successful media business, and it helped him court politicians and businesspeople. The guest list for a 2018 function hosted by his media group in Pyrmont included Minns and a dozen other prominent state and federal MPs.

Wehbe has been a donor to both the Labor and Liberal parties. The Wehbe Group headquarters is located directly across the road from the Canterbury-Bankstown council house, and Wehbe is also listed as the owner of an office building next door that houses the electorate office of federal Labor MP Jason Clare.

The Bellevue site has been there throughout the family’s rise, although it has been struck by arson on three occasions over the years, with motives unknown, and has often failed to turn a profit as a function centre.

The then-Bankstown Council sought to wind up the Bellevue in 1994 over unpaid rates and the NAB bank had been pressuring the pair over the company’s large debts. But the two businessmen were able to stave off the bank by selling the car park attached to the Bellevue site. Bank documents showed the address of the purchasing company was “care of” E. Obeid at Hunters Hill, the Herald reported at the time.

Another company, Dakmint, approached NAB offering to buy out the Bellevue company’s debt for $2.1 million. The bank accepted, and wrote off $2.5 million. Further bank documents showed that Dakmint’s phone number was Obeid’s direct line at parliament house.

Cars queue for discount petrol at Kemps Creek in 1986.

In 1993, Eddie Obeid’s son Paul acquired his father’s share of the company for $1. In 2017, Paul transferred his shares to Hassim Achie for $1. In 2018, Achie sold them to Wehbe, also for $1, making Wehbe the sole owner. Mihailuk described this in parliament as “the sale of the century”.

These days part of the Wehbe family is based in a mansion at Illawong, in the city’s south-west, which enjoys sweeping views over the Georges River towards Botany Bay.

It’s a long way from the service station at Kemps Creek. What customers filling up their tanks for 1¢ didn’t know in 1986 was that a month earlier Wehbe had faced court accused of receiving tankers of fuel stolen from the terminal at Banksmeadow.

The trial judge stated it was open to him to find that “Mr Wehbe is dishonest or otherwise not of good character”. But a key witness – the truck driver who had delivered the stolen fuel – refused to testify. Wehbe was acquitted.

The Morning Edition newsletter is our guide to the day’s most important and interesting stories, analysis and insights. Sign up here.