The NSW Independent Commission Against Corruption (ICAC) has found that three former Hurstville City and/or Georges River councillors, and one other, engaged in serious corrupt conduct by receiving or giving benefits in relation to two large development proposals which the three councillors supported without declaring any conflicts of interest.
In its report released today, Investigation into the conduct of three former councillors of former Hurstville City Council, now part of Georges River Council, and others (Operation Galley), the Commission finds that, between 2014 and 2021, former Hurstville City Council (HCC) and/or later Georges River Council (GRC) councillors Vincenzo Badalati, Constantine Hindi and Philip Sansom engaged in serious corrupt conduct. This included Mr Badalati and Mr Hindi accepting (approximately in the case of Mr Hindi) $170,000 each from developer Ching Wah (Philip) Uy as an inducement or reward to use, or for having used, their positions as councillors to favour the interests of Mr Uy and the proponents of two proposed developments in Hurstville ("the Treacy Street and Landmark Square developments").
These payments occurred in 2018, when Mr Badalati and Mr Hindi each accepted $100,000 in relation to the Landmark Square Development and in 2015 when they each accepted (approximately in the case of Mr Hindi) $70,000 in relation to the Treacy Street development.
The three councillors also engaged in serious corrupt conduct by attending council and voting in favour of applications relating to the development proposals, having failed to declare non-pecuniary interests that had arisen from their relationships with Mr Uy and another developer, Wensheng Lui.
Wensheng Lui, through his company GR Capital Group, was the proponent of a development proposed to build an 11-storey block of apartments located at 1–5 Treacy Street, Hurstville ("the Treacy Street Development"). Wensheng Lui was also the sole director and secretary of One Capital, the proponent of the Landmark Square planning proposal which was situated at 53–75 Forest Road, 108–126 Durham Street and 9 Roberts Lane, Hurstville, over approximately 14,000 square metres ("the Landmark Square development"). Mr Uy was involved in both developments through his building company, Gencorp, and through his own financial investment.
The Commission found that Mr Badalati and Mr Hindi engaged in serious corrupt conduct by travelling to Tangshan, China, in April 2016 when they knew that their status as public officials with Hurstville City Council (HCC) would be misused to endorse and promote the Treacy Street and Landmark Square developments in the interests of One Capital, Wensheng Lui, Yuqing Liu and Mr Uy. Mr Hindi and Mr Badalati accepted benefits in association with this trip including payment by Mr Uy and/or Yuqing Liu (or his company, Xinfeng) for flights and accommodation and travel in luxury cars (including for Mr Hindi's wife). Mr Uy engaged in serious corrupt conduct by providing the above benefits to Mr Badalati and Mr and Mrs Hindi as an inducement or reward for Mr Badalati and Mr Hindi to use their positions as HCC councillors to favour Mr Uy and the proponents of the Treacy Street and Landmark Square developments.
Mr Sansom engaged in serious corrupt conduct by accepting payment for his and his partner's return flights for a trip to China in March and April 2014 when he knew the payment was intended to influence him in carrying out his official functions, including in relation to the Treacy Street and Landmark Square developments. Mr Uy was found to have engaged in serious corrupt conduct for making the payment under these circumstances.
Councillors Badalati, Hindi and Sansom attended meetings and voted in favour of the Treacy Street planning proposal in April 2016. Councillors Badalati and Hindi continued to make decisions in relation to the development from 2017 to 2019, by which stage they had been elected to the amalgamated Georges River Council. At no stage did the councillors disclose any of their pecuniary or non-pecuniary interests in these matters. This included Mr Hindi failing to disclose his pecuniary interest in the Landmark Square planning proposal through his wife's (Mireille Hindi) interest in that development pursuant to a Buyer's Agency Agreement between One Capital and Mrs Hindi's real estate agency under which Mrs Hindi stood to gain $500,000 (ex GST).
The Commission has made 11 corruption prevention recommendations to the Department of Planning and Environment (DPE) including that the DPE amends the Model Code of Conduct to prohibit council officials, including councillors, from accepting gifts and benefits, including hospitality and contributions to travel, from property developers (with some hospitality exceptions such as attendance at industry briefings or educational events). The Commission also recommends that that DPE seek amendment to the Local Government Act 1993 to require a council's governing body to provide reasons for approving or rejecting development applications, planning proposals and planning agreements where decisions depart from the recommendations of staff.
The Commission seeks the advice of the Director of Public Prosecutions (DPP) on whether any prosecution should be commenced. The DPP determines whether any criminal charges can be laid and conducts all prosecutions. The Commission is of the opinion that consideration should be given to obtaining the advice of the DPP about the prosecution of Mr Badalati, Mr Hindi, Mr Uy, Mrs Hindi and Mr Sampson for various offences.
The Commission held a public inquiry, as part of this investigation, over 25 days in June, July and August 2022. Commissioner Stephen Rushton SC presided at the public inquiry at which 19 witnesses gave evidence.
