Reserve chief urged to table bribery scandal documents

Reserve Bank governor Glenn Stevens.
Reserve Bank governor Glenn Stevens.

Federal Liberal MP Tony Smith has called on Reserve Bank governor Glenn Stevens to table internal documents regarding the bank’s knowledge of a bribery scandal enveloping two of its banknote printing subsidiaries.

In a speech to Parliament last night, Mr Smith said Mr Stevens’ appearance before the House of Representatives economics committee this Friday would be a good opportunity to release documents regarding 2007 warnings of corruption which the RBA chose not to refer to federal police.

Fairfax last year revealed that senior bank officials were given explicit information in 2007 to suggest subsidiary Note Printing Australia had been exposed to bribery in Asia through the actions of its agents.

Instead of passing the information to police as Commonwealth agencies are generally required to do, the RBA referred the matters to law firm Freehills. Freehills, according to the bank, determined it could find no breach of Australian law.

Police were only called to investigate suspected bribery in 2009 after Fairfax published reports alleging NPA’s sister firm, Securency, had made multimillion-dollar payments into tax haven accounts belonging to foreign middlemen with murky pasts.

Both firms are supervised by boards controlled by the RBA.

Mr Stevens and recently retired deputy governor Ric Battellino have repeatedly told parliamentary committees that the first anyone in the bank knew of bribery concerns was when Fairfax’s 2009 reports appeared.

‘‘As this issue has unfolded, serious questions have been raised in the media about the governance practices at the highest levels of our Reserve Bank,’’ Mr Smith said last night. ‘‘In response, senior bank officials have repeatedly asserted their ignorance of allegations about possible illegality at Securency or Note Printing Australia before media reports first surfaced in mid-2009,’’ he said.

‘‘In this light, I think Governor Stevens would do well to take the initiative and table the 2007 written brief at the hearing to be held this Friday.

‘‘It is because I hold the Reserve Bank in such high regard that I offer this suggestion, because if these questions linger today they will fester tomorrow.’’

Eight former executives from Securency and NPA are facing a committal hearing in Melbourne at present on Australia’s first foreign bribery charges.

No directors of Securency or NPA have been charged with offences. Corporate watchdog the Australian Securities and Investments Commission has decided against investigating any board members for possible breaches of directors’ duties.

This story Reserve chief urged to table bribery scandal documents first appeared on The Sydney Morning Herald.