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By Joseph Dunstan

Businessman blames 'poor choice of words' for email suggesting deputy mayor owed him a favour

A Melbourne businessman has blamed a "poor choice of words" for an email he wrote to his employer which suggested a deputy mayor who owed him a favour could help them buy outright a council property they were leasing.

The Independent Broad-based Anti-corruption Commission (IBAC) investigation into the City of Casey in Melbourne's south-east today turned its focus to the relationship between businessman Andrew Nehme and former mayor Sam Aziz.

The inquiry is investigating allegations Mr Nehme, who directs business groups linked to The Action Group Australia for the Kuwaiti Sheikh Mubarak al-Sabah, paid $251,000 to Mr Aziz as a bribe after the City of Casey sold the Casey Lifestyle Centre and adjoining land to his business in 2016.

The allegations are strenuously denied by both Mr Aziz and Mr Nehme, who say the payment was a personal loan offered by Mr Nehme to Mr Aziz.

Email suggesting a favour owed was 'tongue-in-cheek'

The inquiry heard Action Realty Australia held a 30-year lease over Casey Lifestyle Centre in 2005, but was locked in disputes with the council over the fees it should pay and the collection of rental arrears, and was interested in buying the freehold for the property.

While Mr Aziz previously told IBAC he first met Mr Nehme in 2007, before he was elected to local council, Mr Nehme said he did not recall meeting Mr Aziz any earlier than 2012.

In mid-2013, Mr Nehme said he assisted Mr Aziz's family dental practice by helping put them in contact with someone he knew in Medibank to help secure them as a provider for the business, but downplayed it as "irrelevant help" and simply introducing two people.

But in an email sent to Sheikh Mubarak and other business colleagues on June 5, 2013, Mr Nehme described a situation where Mr Aziz may feel obliged to return a favour.

"It's been a fortunate situation as I have been able to assist his wife who's a dentist and requires support from a health insurance provider who I know their CFO [sic] and he has kindly assisted them in growing their business," Mr Nehme wrote in the email.

He wrote that Mr Aziz "feels compelled to respond with a favour to me so let's put him to the test".

"It's poorly worded on my part," Mr Nehme said when asked if he was telling his boss the then-deputy mayor owed him and they could use it to their commercial advantage.

"That would have been a tongue-in-cheek [comment] which is very typical me with the Sheikh, we put everyone to the test," Mr Nehme said.

He denied that at the time of writing the email, he believed Mr Aziz owed him a favour.

Councillor fiercely advocated for business's interests

Mr Nehme also suggested there was minimal communication between him and Mr Aziz during the years leading up to the sale, when the inquiry heard the councillor forcefully advocated for Mr Nehme's business interests.

Mr Nehme said he raised concerns about the "appalling" conduct of council officers who were threatening to call in a bank guarantee on his lease payments with Mr Aziz, who was his local ward councillor at the time.

The inquiry heard Mr Aziz then pushed for an urgent private council meeting to escalate the complaint about the council officer involved.

In December 2014, as councillors considered rescinding a previous motion on selling the freehold on the lifestyle centre, Mr Aziz told his fellow councillors an independent report scrutinising the value of selling the freehold on the property would be a waste of ratepayer money.

Mr Nehme said he could not recall how much he was told about the outcomes of Mr Aziz's advocacy.

Part of loan repaid in cash, inquiry told

When asked about the $251,000 payment made to Mr Aziz after the sale of the property, Mr Nehme told the inquiry $230,000 of the "personal loan" was repaid by Mr Aziz in bundles of $50 and $100 notes, which Mr Aziz brought to his home in shopping bags.

He said the money was placed into a safe in his family's home and then spent in Australia and during an overseas holiday, but he was unable to identify any single traceable purchase made with the cash.

He said Mr Aziz had told him he had withdrawn the money from a Westpac branch in Berwick.

"I was just happy to get the money back. Didn't like the cash, but just happy to get it back," Mr Nehme told the inquiry.

During Mr Aziz's evidence last month, IBAC commissioner Robert Redlich QC accused Mr Aziz of creating false documents to fabricate the appearance of a $230,000 repayment, a claim denied by Mr Aziz.

Today Mr Nehme recalled how after his home was raided, Mr Aziz visited him to apologise for "dragging my family through the mud".

But he said he did not ask Mr Aziz for further details about the loan they had been involved in because as far as he was concerned it had been paid back and dealt with.

"What he's done is his business, not mine," he said.

Businessman refutes suggestions loan was in fact a bribe payment

He was pressed by counsel assisting IBAC, Michael Tovey QC, on why he did not ask more questions about the loan, given he had just discovered its existence had become a matter of interest to an anti-corruption inquiry.

"Can I suggest to you the reason you didn't ask him, because you knew the loan was in fact either a payment in the nature of a bribe or a thank you?" Mr Tovey asked.

"That's absolutely incorrect, Mr Tovey," Mr Nehme replied.

The inquiry hearing was later told video footage showed Mr Nehme had told IBAC officers during the raid on his home that Mr Aziz had in fact visited him before, and not after, his house was raided and had told him he was on IBAC's list.

IBAC commissioner Robert Redlich QC said Mr Nehme's family had become involved in the matter "because of the arrangements you made with him".

"It's not just the money that you lent him, is it Mr Nehme?" Mr Redlich asked.

"It's the role he played in facilitating the commercial objective that you wanted."

"I disagree, commissioner. Absolutely disagree on that," Mr Nehme replied.

He is due to give further evidence to IBAC in a public hearing from 10:00am on Thursday.

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