Australian lawyer arrested over Ok Tedi mining fund
Published by MAC on 2021-01-27Source: SMH, The Guardian
Police allege that expenditures were not consistent with the fund intended purpose.
Australian lawyer Greg Sheppard has been arrested in Port Moresby on fraud charges. The former Queensland prosecutor has practised in the island nation for more than three decades. According to a statement released by the office of PNG's Commissioner of Police, David Manning, Sheppard was arrested over allegations relating to dealings with a public trust set up to benefit villagers affected by mining operations. Police allege 268m kina was misappropriated from the Western Province People’s Dividends Community Mine Continuation Agreement (WPPD CMCA) trust fund and improperly paid into the accounts of the Ok Tedi Fly River Development Foundation (OTFRDF) and Sheppard’s law firm.
When BHP built Ok Tedi on difficult mountainous terrain near PNG’s border with Indonesia in 1984, it did not construct a tailings dam to store waste from the giant mine, instead pumping sludge directly into the Ok Tedi and Fly rivers. The tens of millions of tonnes of tailings discharged each year over decades killed fish and trees, poisoned croplands and drinking water, and devastated the area’s economy, sparking a large-scale, and ultimately successful, lawsuit by locals against the miner, and the establishment of the trust fund. But for years, residents of those villages, and politicians in Port Moresby, have complained that none of the compensation promised has ever reached the communities of Western Province, which remain some of the most impoverished in the country.
See also:
2020-08-06 Ok Tedi mine closes, as Covid-19 spreads
2019-05-05 Life after Ok Tedi - can it compensate for huge mining sacrifices?
2016-01-18 Former PNG PM takes legal action against Ok Tedi Act
2014-01-30 Papua New Guinea court orders Ok Tedi to halt dumping waste
2013-03-19 PNG: Ok Tedi mine a curse
2011-12-27 Ok Tedi pays compensation to Papua New Guinea villagers
Australian lawyer Greg Sheppard arrested in PNG over mining fund
Angus Thompson
https://www.smh.com.au/
January 21, 2021
An Australian lawyer who has boasted of a client list that included senior Papua New Guinea government figures has been arrested in Port Moresby on fraud charges.
Former Queensland prosecutor Greg Sheppard has practised in the island nation for more than three decades.
According to a statement released by the office of PNG's Commissioner of Police, David Manning, Mr Sheppard was arrested on Wednesday over allegations relating to dealings with a 268 million kina ($97 million AUD) public trust set up to benefit villagers affected by mining operations.
According to a local media report, the funds are held in an account with ANZ bank.
Mr Sheppard was charged with two counts of conspiracy and another count of false pretence before being taken into custody in the Port Moresby suburb of Boroko.
Investigators will allege two transactions totalling 52 million kina ($19 million AUD) were paid into the account of Mr Sheppard's Port Moresby-based firm Young & Williams Lawyers, and three transactions totalling 216 million kina ($78 million AUD) were paid into the account of the trust, known as the Western Province People’s Dividends Community Mine Continuation Agreement.
Mr Manning's office said in the statement that the investigation was ongoing and included a forensic probe in the appointment of the fund directors, unauthorised expenditure of the trust money, and the bank accounts held by the trust, associated with the Ok Tedi Fly River Development Foundation, and the law firm.
"This includes forwarding proceeds from the K268 million to personal bank accounts of [trust] directors/employees," the statement said.
"Police will also allege that the expenditures were not consistent with the spirit, tenor and intended purpose of the ... Trust Funds, and used for purposes contrary to the CMCA beneficiaries."
The commissioner's office said other directors of the fund and other suspects would also be "brought in for inquiry into their alleged involvement in committing the fraud."
According to the statement, the trust funds belong to more than 147,000 people from 158 villages in the Western Province, reaping dividends based on equity held in the Ok Tedi Mining Project, an open-pit copper and gold mine.
Local media outlet the Post-Courier reported last week that a female director of the Ok Tedi Fly River Development Foundation was arrested on allegations of misappropriating money from the trust.
According to the website for the law firm, of which Mr Sheppard is a partner, "he has acted for a number of prominent clients in Papua New Guinea, including Prime Ministers, Ministers of State and businessmen."
Mr Sheppard also managed his children's' pop group, Sheppard, which had a number-one Australian hit single, Geronimo, and has been nominated for several major recording industry awards.
Mr Sheppard was appointed in 2014 as a "resident" director of the company that provided security to the former Manus Island immigration detention centre, but resigned in 2015.
Australian Greg Sheppard's law firm says charges over PNG mine fund are 'politically motivated'
Fraud charges laid against an Australian lawyer arrested in Papua New Guinea are “politically motivated” his law firm says, while the trustees of the fund allegedly defrauded of nearly $100m have also come to his defence.
Greg Sheppard, a former Queensland prosecutor, has been bailed on two charges of conspiracy and two of false pretence, but will “vigorously defend” the charges, the Guardian has been told.
Almost $100m has allegedly been defrauded from a trust fund established to finance development projects in communities which have been devastated by massive environmental damage wreaked by the Ok Tedi copper and goldmine.
Police allege 268m kina was misappropriated from the Western Province People’s Dividends Community Mine Continuation Agreement (WPPD CMCA) trust fund and improperly paid into the accounts of the Ok Tedi Fly River Development Foundation (OTFRDF) and Sheppard’s law firm.
The trust fund was established with profits from the Ok Tedi mine to fund development projects, such as roads, schools and health clinics for villages in Western Province impacted by the mine.
When BHP built Ok Tedi on difficult mountainous terrain near PNG’s border with Indonesia in 1984, it did not construct a tailings dam to store waste from the giant mine, instead pumping sludge directly into the Ok Tedi and Fly rivers.
The tens of millions of tonnes of tailings discharged each year over decades killed fish and trees, poisoned croplands and drinking water, and devastated the area’s economy, sparking a large-scale, and ultimately successful, lawsuit by locals against the miner, and the establishment of the trust fund.
But for years, residents of those villages, and politicians in Port Moresby, have complained that none of the compensation promised has ever reached the communities of Western Province, which remain some of the most impoverished in the country.
The Ok Tedi Fly River Development Foundation (OTFRDF), a not-for-profit organisation representing the communities affected by Ok Tedi mine pollution, says the money was legitimately transferred following a 2018 decision from the national court which ordered the OTFRDF replace the PNG government as trustees of the fund.
“The Ok Tedi Fly River Development Fund mission is to recover money that rightfully belongs to the pollution-affected people of the Fly River region and has been misappropriated over two decades,” a spokesperson for OTFRDF said.
“The national court appointed OTFRDF as trustee of some of these funds … [in] 2018. We have won every case that has gone before the PNG courts, and legally transferred the funds into the trust accounts of our lawyers, both in PNG and overseas.
“Attempts to arrest members of our board, including Edna Oai, follows these successful legal actions. It is an unlawful attempt by powerful forces in PNG to keep control of money that rightfully belongs to the pollution-affected people of the Fly River region.”
A spokesperson for Sheppard’s law firm, Young and Williams, said it had, at all times, acted on the advice of OTFRDF “and all transactions have been in accordance with the PNG court order”.
“Young and Williams is the only major law firm in PNG that does not work for the government, and as such we are one of the only law firms willing to take legal action against the government on behalf of clients. The charges levelled against our firm’s partner are politically motivated and follow the PNG government’s failure in the court system. The charges will be defended vigorously.”
But in a statement issued on Thursday, the PNG police commissioner, David Manning, said the transactions were not authorised. He said investigations were continuing and “other suspects will also be brought in for inquiry into their alleged involvement in committing the fraud”.
“The investigation remains ongoing and includes a detailed forensic investigation into … the expenditure of the 268m kina, which police will allege were not authorised by the trust … this includes forwarding proceeds from the 268m kina to personal bank accounts.”
Earlier this month, 45-year-old Edna Oai, from South Fly district in Western Province, was charged with 15 counts of false pretence, conspiracy and misappropriation over the alleged fraud.
Gregory James Sheppard, an Australian citizen, has practised law in PNG for more than three decades, and is a partner at Port Moresby law firm Young and Williams. Its website says Sheppard “has acted for a number of prominent clients in Papua New Guinea, including prime ministers, ministers of state and businessmen.”
Sheppard was also the manager of Brisbane indie-pop group, Sheppard, of which three of his children are members. The group had a No 1 Australian hit single, Geronimo, and performed at the AFL grand final last October.