Archive for December 31, 2011

EYE-BALL’s Human Evil Exposed – John O’Neill (CEO-ARU) … Part 1

The-EYE-BALL-NovelZone Header
Human Evil Exposed –
John O’Neill (CEO-ARU) … Part 1

Link to all Posted Chapters for –

“Human Evil Exposed – John O’Neill (CEO-ARU)” – The SBS Story

The “Human Evil Exposed” – John O’Neill   story link above takes you to a new page where all the chapters to this story are listed and linked.

All the documents that form a part of this story as evidence is linked here. These documents form the evidentiary trail collected as a part of the research undertaken during this project.

The “Human Evil Exposed” – John O’Neill story thus far covers events that took place between 1931 – 1995.  The final ending is still to be played out.  The motives for what took place in the late 70’s and early 80’s happened in 1931 when the then NSW Government owned – ‘Government Savings Bank of NSW’ was forced to close its doors. This set in motion a number of events that were not resolved until Dec 1987. The motives behind this story are steep in history and these grudges were held for a long time.

After they were finally settled – what then took place culminated in a $75 million FRAUD of public monies carried out by the NSW Government(NSWG) and its agent – The State Bank of NSW – (SBNSW) in 1988. 

The players involved and connected with this FRAUD include:

  • Three consecutive NSW Premiers, Wran, Unsworth and Greiner,
  • Several Ministers serving in those Governments and their staffers – one of these Ministers is now a Justice with the NSW Land and Environment Court,
  • Regulatory Departments including the Department of Co-Operatives, Office of Business and Consumer Affairs, and the Australian Association of Permanent Building Societies, (AAPBS) and,
  • Employed State Bank of NSW Executives – the MD was John O’Neill – who all acted in proven ‘conflict of interest’ positions as Directors on the State Building Society Board, and whose intent was to facilitate a FRAUD against the 270,000 SBS members.

It’s a story that crushed the second largest NSW Building Society and at the time it had $1.6 billion in assets, some 270,000 Society members, and 650 SBS staff.

This is a story told by someone who lived through the 87-88 period and is told from his perspective and the evidentiary proof collected from research undertaken to prove the allegations.  This story comes from a corrupted base of Corporate greed, corrupt and immoral Director’s, complicit Government representative’s, ego’s driven by historical flawed motive’s, financial market operative’s, drugs, sex, and the brazen Corporate RAPE and THEFT of the $75 million value attached to the State Building Society.

John O’Neill as the MD of the SBNSW destroyed a profitable and functioning Building Society because he could.  It was done out of spite and revenge because he lost the 10 year plan to merge the SBS with the SBNSW.  In the process he stripped the SBS of its corporate worth and broke all the Corporate and Regulatory rules in doing so.  Rules that were put aside by the Administrators charged with the protection of the SBS members and their entitlements.  He had help in the NSW Premier Nick Greiner who sanctioned O’Neill’s actions.

The story has many sub-plots and plots within those sub-plots – it is complicated, and to get a full appreciation of these complexities there is much reading to be done.

Please use the comments option below each post for any comments you might want to express – to ask any questions you want clarified – or if you want to make a private comment … please use the e-mail link here – – Enjoy the read …

The EYE-BALL Opinion … [ … where evil lurks – so do friends of the devil … ]

Definitions of Allegations alleged against Mr John O’Neill and his cohorts …

Linked: The Definition of EVIL:

  • morally wrong or bad; immoral; wicked: evil deeds; an evil life.
  • harmful; injurious: evil laws.
  • characterized or accompanied by misfortune or suffering; unfortunate; disastrous: to be fallen on evil days.
  • due to actual or imputed bad conduct or character: an evil reputation.
  • marked by anger, irritability, irascibility, etc.: He is known for his evil disposition.

Linked: Moral Bankruptcy:

  • Definition: the state of being devoid of morality and ethics, used esp. for business and political entities
  • Example: A complete lack of morals is moral bankruptcy.

Linked: Definition of RABID:

  • – irrationally extreme in opinion or practice:
  • – furious or raging; violently intense:
  • Synonyms – zealous, fervent, ardent, fanatical, bigoted.

Linked: Definition of FRAUD:

  • – deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage.
  • – a particular instance of such deceit or trickery: mail fraud; election frauds.
  • any deception, trickery, or humbug: That diet book is a fraud and a waste of time.
  • a person who makes deceitful pretenses; sham; poseur.


Part 1 commences …

There are a billion tragic and human stories out there around the World – many involve death, injury, personal sufferance and consequences of actions taken by others.  Many have origins where third-party influence created the circumstances that in turn caused the tragedy.There is a saying that – “for every action there is always an equal and opposite reaction” – it is based in physics – yet it rings true everywhere and about everything human as well.

Human action and its most common of motivators – the human ego and greed – have been the responsible agent and cause of every conflict and argument that has tragedy as an end result.  The following tale of ‘evil’ intent and outcome is just one of those lesser known stories and it has many bit-part players.  There is no death or physical injury that one can see – not obvious anyway – just lifetimes of lost opportunity for many people who suffered at the hands of a single mans ego, and his  want to make others pay and cover for his mistakes.

This mans actions involved and orchestrated a fraud upon 250,000 State Building Society (SBS) shareholders in 1988.   He was the caretaker who inherited an ongoing FRAUD.  In bringing the to a close – his actions resulted in an alleged theft of value attached to retained capital amounting to $60 million, plus the peer viewed market value of a $1.6 billion Building Society.  His employer – the State Bank of NSW (SBNSW) and owned by the NSW State Government (NSWG) – received the proceeds of this alleged fraud that in part helped to stave off the SBNSW’s own collapse at a time when other State Banks were floundering as a result of the Oct 1987 Global equities crash.  These were desperate times and as history has shown – people stooped to new lows in Corporate behaviour when their backs are against a wall.

This man spoken of – Mr John O’Neill – is the current CEO of the Australian Rugby Union (ARU) – and his desperate actions against the SBS were also a result of the ’87 crash – he was horribly under skilled for the task asked of him – he was inexperienced – and least of all he was the most unsuitable of persons to inherit a Political appointment based on family and friends political connections.

His decisions alone as the SBNSW’s CEO caused his Bank to generate massive losses.   When he sort help from the NSWG – they refused his request for capital and thus set in motion a set of events that led to the alleged FRAUD.   These actions were sanctioned by the NSWG and resulted in the stripping of assets and value belonging to members and shareholders of the then NSW based ‘State Building Society’ (SBS).

Mr O’Neill’s main partner in this crime was the then newly elected NSW Premier – Nick Greiner – and together they sanctioned and abetted a course of action to preserve the SBNSW as an ongoing concern at the expense of the SBS, its shareholders/members and their capital reserves.   This shameful act has yet to be exposed in any mainstream way – many know of the alleged FRAUD and its intent and outcome – many were complicit – many turned their backs – and many received financial gain as a result.

Radio Broadcaster Alan Jones had a go at exposing O’Neill’s poor Banking skills and record as a Banker many years ago.  He attacked O’Neill in a personal and ‘grubby’ way as Mr Jones so often does – O’Neill responded with a defamation claim and won.   Jones paid $50k in damages – however Jones was not wrong in his claim – his claim that O’Neill was a Banker of little repute and responsible for leaving NSW taxpayers deep in debt – since acknowledged to the tune of $1.8 billion was very close to the truth.  Jones just could not prove his allegations at the time.

What follows is a ‘bulleted’ outline that covers some of O’Neill’s actions that led to the alleged fraud and how it was carried out.

July 1987:  O’Neill’s appointment –

  • O’Neill is promoted from Company Secretary of the State Bank of NSW serving under Nick Whitlam to replace him as CEO.    There were some 14 applicants in line for the promotion – O’Neill leapfrogged them all.   O’Neill joined SBNSW in early 70’s and the Bank sponsored his Law education.   He spent most of his early Bank career serving under Paul Kearns in the Banks Legal Department.   He had very little practical Banking experience if any – working in Legal and then with Whitlam offered very little real Banking experience.  His contacts were all political and that was what won him the gig.  A copy of a media interview O’Neill gave shortly after his appointment appears below and clarify’s so much of what was to follow.


Author: Colleen Ryan | Date: 30/06/1987 |Publication: Sydney Morning Herald |Section: Business Page: 37

Today, two old mates and Labor Party supporters, Nick Whitlam and John O’Neill, start new jobs in banking.

Whitlam becomes a principal of new investment bank Whitlam Turnbull and Co, along with high-profile lawyer Malcolm Turnbull and former Labor Premier of NSW, Neville Wran. It was Wran, of course, who gave Whitlam his last job as head of the State Bank of NSW.

John O’Neill steps into Whitlam’s shoes as managing director of the State Bank. O’Neill has been Whitlam’s personal assistant and secretary of the bank. He leapfrogged eight more senior personnel to get the number one spot.

Both are delighted with their new positions. Whitlam spent some time last week rubbing out entries in his diary for the rest of the year. “It was thrilling. In this job (bank managing director) you are booked up for the entire year. If it’s Wednesday, it is meetings at 10, 11 and 12. Every second week there is an executive committee meeting … It has amazed me that you can ring up businessmen like Rene Rivkin and say ‘What about dinner next week’ and he says ‘Yes, which night?’. You can’t do that in this job.”

There are other anecdotes about the Whitlam departure. His secretary Debbie is going with him to Whitlam Turnbull. At her farewell, held recently in Whitlam’s grand office in the new State Bank headquarters in Martin Place, Whitlam glanced around the room and told the gathering: “I was discussing accommodation with Malcolm Turnbull the other day. He said, ‘It might take a while to get back to the standard you came from. But when you do, this time you’ll own it’.”

At the staff farewell, an emotional Nick Whitlam choked on his words and littered the speech with lengthy pauses. The following week, a public farewell cocktail party for 180 was attended by parents Gough and Margaret, brother Tony and Aunt Frieda, former headmistress at PLC Croydon. It was followed by a smaller dinner in the State Bank executive dining room. Among those invited were Labor Party stalwarts Graham Freudenberg and Richard Hall.

Whitlam is brimming with enthusiasm for the new venture. Already they have a takeover advice job – the subject is a US company, the takeover is valued in hundreds of millions. There are also plans to buy a slice of a publicly listed financial services company in Australia.

In addition, an overseas-based financial services company is being pursued actively. The investment bank hopes to invest in media, minerals and energy and to be an active property developer.

Already, it has begun assembling development sites, according to Whitlam, but he refuses to be drawn on locations. The bank has $50 million in capital and also has behind it the deep pockets of backers Larry Adler of FAI Insurances and Kerry Packer of Consolidated Press Holdings.

The professional back-up staff of 12 or so does not include any well known corporate advice specialists. Whitlam counters: “We have enough names … and I have been hands-on in that area. In the late 1960s and all through the 70s that was really my business at Morgan Guaranty and Paribas. Malcolm, too, has been a very active corporate lawyer. He has been negotiating for Packer for years.”

The move into a smallish investment bank is an enormous change for Whitlam from his tasks over the past seven years. He admits to relief at leaving the government bureaucracy – “… yes, there’s a lot of that”. And there is a change in lifestyle planned too. “I will be much less prosperous looking. There will be less business lunches and more laps.” He swims two kilometres a session at the City Tattersalls Club pool.

O’Neill is enthusiastic about his new job too. But of course he won’t own the offices. At 35, he is the youngest ever managing director of a major Australian trading bank.

He has been with the bank for 16 years and for the past six years has worked closely with Whitlam in revamping the bank and directing its attention to the previously ignored areas of wholesale banking and foreign exchange.  He hadn’t intended applying for the top job until he saw the calibre of some of the 14 or so applicants.

“I thought about it long and hard. Because I had been working so closely with Nick I didn’t have any illusions about the job. I knew how big it was, how demanding, how stressful. I thought it was the sort of job you shouldn’t apply for until you were ready.

“When I started to hear the names of some of the potential applicants I changed my mind – they weren’t good enough and certainly weren’t ready for the job.”

He stops short of saying that he lobbied hard for the job. “After I applied, I made it known that I was a very serious contender. I was not submitting an application just to make up the numbers.

“In my position as secretary, I have come into contact with a lot of the government men and public servants, particularly from the NSW Treasury and the Premier’s Department. The secretary of the bank is a focal point for contact with the outside world.

“I knew them – I didn’t pursue them directly, but at functions and lunches when the topic came up I would let it be known that I was a serious contender.”

O’Neill believes that political affiliations would not have been a factor in the choice of the new head for the Government’s bank. But he is not shy of declaring himself to be a Labor Party supporter.
“I am not a member of the ALP. I am a Labor Party supporter. My father was a GP in Botany for almost 40 years. Ours was not a political household, but I realised in my early 20s that he was a strong Labor Party supporter and a member of the ALP.

“He was on the infamous Botany Council back in the 1950s. There are people I have known for years because they knew my father – like the Breretons and Deirdre Grusovin. I am basically an Irish Catholic traditional Labor person.

“One of the problems in Australia in the past is that there has been some correlation between whether you vote conservative or Labor with how wealthy you are.

“I have known a lot of traditional Labor Party people who as they have got richer have somehow crossed the Rubicon and voted conservative.

“It is some sort of tag you have to wear to make sure you fit into the right circles. But I believe that you don’t forget from whence you came.”

O’Neill was brought up in Bellevue Hill and was a boarder at St Joseph’s College, Hunters Hill. His father, who “lived life to the fullest, smoked 80 cigarettes a day and bet on every race meeting”, brought up nine children. His mother died at 39, when John O’Neill was nine and the others aged between 10 months and 15 years.

“At one stage, my father had six daughters at Kincoppal – goodness knows how he afforded it, he did not die a wealthy man.”

O’Neill joined the then Rural Bank at 17, after failing first year university and after his father’s refusal to fund any further youthful follies.

He later studied law at night and then caught the eye of Nick Whitlam back in 1981, working back until after 6.30pm when his colleagues had long departed. There began a fruitful working partnership.

Nevertheless, O’Neill’s appointment was somewhat of a surprise to interested observers. Front-runner for the State Bank top job was Bob Thomas, one of the bank’s general managers and deputy to Whitlam.

Another strong internal contender was general manager Don Adams. The selection period was a tense time. There were embarrassing incidents where one applicant would walk out of the Treasurer’s office to find one of his superiors in the ante room, awaiting his turn.

“I am told that on paper I was not a leading contender, but I performed far better in the interview department,” O’Neill says.

“The question that had to be resolved by the Treasurer and the interviewing panel was that I was the most convincing candidate in terms of the interview, but I hadn’t had the operational experience, hadn’t got my hands dirty at the coalface.

“But then they thought that my potential, and the fact that I had a strong strategic sense of where the bank was going and had been so closely involved in the last six or seven years, meant that I was more likely to continue the trend.

“I have been in the bank for 16 years, I am known to all the staff, I believe I am well liked and internally the appointment was popular.”

Nick Whitlam was a very high profile bank head, but O’Neill says: “I wouldn’t aspire to the same profile Nick had. It was particular to him and his family name – and he had the great sense of grandeur and style of the Whitlams.

“One of the downsides of that was that people would say you work for Nick Whitlam’s bank. My aim is for the State Bank’s name to be kept up in lights. You don’t hear people say Bob White’s bank or Will Bailey’s bank.”

Whitlam has certainly stirred up the State Bank over the past six years. As he pointed out in his farewell speech, the State Government up until the end of this financial year will have received some $200 million in dividends from the State Bank – a whopping $160 million of it under Whitlam’s stewardship.

But there are problems too – high gearing, relatively low profitability and the Amalgamation Agreement battle with the Commonwealth Bank.

The bank’s gearing is nudging the 20:1 ratio the Reserve Bank sets for the private banks. Accordingly, it is constrained in increasing its asset base.

The State Bank needs an injection of capital – which O’Neill hopes to achieve through the issue of bonds known as mandatorily convertible notes(MCNs). Until this occurs, any growth will have to be off balance sheet, such as property development, foreign exchange and corporate advice.

Property development is, perhaps, the most interesting – O’Neill plans a number of joint ventures with selected developers such as Civil and Civic and White Industries.

The capital increase through MCNs had been planned as a perpetual note issue, which the State Savings Bank of Victoria managed successfully.

But the market for these has collapsed and the use of five-year notes, at a higher rate, is now the most likely alternative. Because the new capital will be costly, it will have to be directed to high margin areas such as wholesale banking, according to O’Neill.

The State Bank’s profitability level, too, is low – its return on shareholders’ funds at about 6 per cent compares unfavourably with the majors.

O’Neill points out that profitability could be improved substantially if the State Bank could operate a savings bank, offer competitive deposit rates and move into home lending to increase its customer base.

This can’t be done while the infamous Amalgamation Agreement with the Commonwealth Bank is still in existence. But O’Neill believes that with two new managing directors in place – he at the State and Don Sanders at the Commonwealth, a solution could be near.

“If I was Don Sanders I would want to clear the decks. They have had to part with a good deal of money recently – $129 million so far.

“And we are turning up the heat to ensure that they do account properly for the profits of the savings bank operations in NSW.”

There is an offer on the table from the State Bank to tear up the agreement- for a payment from the Commonwealth of $200 million. O’Neill conceded that this was probably a bit high.

“There has to be a discount for the benefits we would gain by starting up a savings bank. Maybe, we could come to an agreement of, say, $100 million over five years.”

The end of the Amalgamation Agreement is crucial for O’Neill’s plans for the future. For Whitlam, the heated battle with the Commonwealth is a problem of the past.

O’Neill says of his former boss and mentor: “Nick has done a tremendous job. Like his father, he is a major reformer. He has been an agent of change and has shown a lot of resourcefulness and determination and it was always done with a great sense of style.

“There are some drawbacks. For example, the advantage of an under-utilised balance sheet has disappeared.

“My job is one of consolidation – working out a way to keep the upward trend in performance.”

  • O’Neill’s family history was deeply entrenched with the ALP and DLP during the 60’s and this gave him powerful influence and connections within the NSW State ALP – it was these connections that gained O’Neill his appointment.   The CEO position was a NSW State Government appointment –
  • History and some of the comments registered in his interview above clarify he was never worthy of the position based on his Banking experience and employment credentials – his was purely a political appointment and it resulted in massive Bank losses that ended up as NSW Taxpayers debt obligations when the NSW State Treasury assumed the bad debts when the State Bank was sold to Colonial Mutual in 1995.
  • Prior to Whitlam’s tenure expiry in July ’87 – and some four years earlier when he appointed Dennis Cleary to the position of CEO at the State Building Society – Whitlam used a ‘carrot’ to tease loyalty out of Cleary in that he would become his SBNSW CEO replacement when his 7 year tenure expired in 1987.  [According to a statement made by Denis Cleary.]  This helped to cover the ruse that was the reason why the SBS was formed and what its ultimate fate would be – a merger with the State Bank as its Savings Bank arm.
  • Around this time a long term dispute reaching back to 1931 was settled with the Commonwealth Savings Bank.  The dispute covered the State Banks forced closure post the ’29 crash and under the Premiership of ALP stalwart Jack Lang.   It was settled with intervention from the then PM James Scullin and the Commonwealth Bank Heads who were the Central Bankers of the day.
  • In 1982 the CSB took action against the SBNSW over the formation of the SBS – this High Court challenge was decided in 1985 and 2+ years of appeals ensured with the CSB ordered to pay the SBNSW/NSW Government in excess of $300 million.
  • The final settlement was paid in Dec ’87.    Yet prior to this O’Neill had established a growth policy for the Bank and became involved with a number of CBD property developments in and around Sydney.   When the October ’87 crash hit – O’Neill’s Bank world began to crash.  The CSB settlement went somewhat to help out but the Bank was still hemorrhaging badly – it was also losing quality Treasury staff because O’Neill’s style of Management was ‘my way or the highway’ – a number of senior staff jumped ship.
  • The SBNSW plan was to merge with the SBS to form a full service Banking unit including savings and trading Bank operations.  The CSB deal from 1931 prevented the State Bank from operating a Savings Bank in NSW whilst the CSB continued to operate a Savings Bank [Clause 17 of the Agreement].  The whole purpose in establishing the SBS was to set up a situation for a legal challenge from the CSB and thus set in motion an agenda to have the 1931 agreement overturned.
  • State Bank Witness’ at this 1982-85 court case gave evidence that was said to be ‘perjured’ as a means to get the result they wanted.   After the CSB settled their court battle in late ’87 – the State Bank made a move to merge the SBS in Jan ’88.   The move was rejected and the then Labour Premier Unsworth told O’Neill to back-off and would not support a merger.  This left O’Neill and his Bank a ‘dead-duck’ in the water as relates to the end-game strategy after the 1931 Agreement had been overturned.
  • At this time – the State Bank was losing $100’s millions after the Oct ’87 crash – and the State Government had told O’Neill they would not be injecting funds to recapitalise the Bank.    This made O’Neill desperate to the needs of the cheaper funding base of the SBS and its retained capital reserves.
  • O’Neill began to cover ‘bad-debts’ and ‘non-performing’ assets – the NSW State Election in Mar ’88 was his last chance for a windfall result.  If Unsworth lost the election – his plan was to get the then Opposition Leader and new Premier Nick Greiner on side.  This came to pass and after Greiner won the election in a minority Government result – O’Neill went to Greiner with his plan to merge the SBS with the State Bank.  Greiner signed off on the deal within days of taking office without understanding what was really at stake – or even if what O’Neill was proposing was legal.  O’Neill mislead the Premier on several issues.
  • When the Parliamentary vote came to pass the merger proposal – the then Minister for ‘Office of Fair Trading’ Jerry Peacocke – refused to allow the vote – he had sought legal opinion from the Crown Solicitor’s office who ruled that a merger was not possible because the shareholders of the SBS would be disadvantaged – and that a ‘conflict of interest’ existed.  This stumped Greiner’s and O’Neill’s vote plan.   Up until this point the had been no real major fraud committed other than minor breeches of Legislative processes and a few misguided conspiracy agendas.
  • From this point on – the SBNSW and its staff became co-conspiracy with the Premier and staff from the Premiers office to commit a fraud – both offices were complicit in the alleged fraud that took place.
  • Obtained documents from 1982-88 do prove beyond any doubt that both the NSW Government and the SBNSW Executive set up an entity with intent to self-managed a entity for Corporate gain. That fraud ended with the theft of the market value pertaining to the retained earnings, the SBS capital base and the Building Society business that existed for its members – all to serve a desperate John O’Neill who was trying to save his own Bank.
  • In the ensuring six months State Government Ministers reversed their positions – $5 million of the SBS profit results were withheld from the May ’88 end of year profit announcement for purposes unknown.  Existing Independent SBS Directors were approached for favour to support the State Bank in its endeavours – one such Independent Director turned his support in favour of the State Bank after having a meeting with John O’Neill.  That Director was appointed Deputy Chairman of the SBS after O’Neill orchestrated a ‘boardroom-coup’ in early May ’88.
  • Documents held support all this information – including O’Neill’s removal as self-appointed  Chairman of the SBS by the State Governments – ‘Office of Fair Trading’ and O’Neill’s attempts to stay that decision.  During his ‘stay’ he proceeded to lock down the SBS Management by sending staff on administrative leave, and dismissing other senior Staff – including the Chairman and the CEO – [Ken Dennewald and Dennis Cleary].
  • O’Neill then went on a public media and internal propaganda mission to convince SBS customers that the State Bank knew what was best for the SBS members and shareholders.  All the while and unknown to all but State Bank Executives and Members of the NSW Premier’s staff, including the Premier – O’Neill had already consummated a deal ‘in principal’ with Fred Shields – the then CEO of St George Building Society (St George) – to sell the SBS to St George for $70 million plus interest accrual from Jun ’88.
  • Attempts by other Building Societies and Banks to make a bid for the SBS before and after the deal with St George were turned away by the Premier who was in on the secret St George deal.
  • At the time the SBS held $1.5 billion in shareholder capital – the State Bank owned $3 million of fixed-capital and were dealing from that position on behalf of all the other SBS members and shareholders.   This ‘conflict of interest’ was challenged successfully by the ‘Office of Fair Trading’ when the Bank first tried to merge with the SBS – but when the sale option was sort and on the table – the Minister for Fair Trading – [Jerry Peacocke] – and other Government Departments against the merger deal – suddenly began to find ways to change their minds and support the sale.
  • Senior Public Servants with direct relevance to the original decision to prevent the merger – received internal promotions in what looked like bribed approval for the support for the SBS sale to St George option.
  • O’Neill oversaw all this whilst still serving as Chairman of the SBS under a stay of proceedings over his dismissal by the Office of Fair Trading for ‘conflict of interest’ issues.   When O’Neill finally stood down – his successor was another State Bank employee – Paul Kearns – who had served on the SBS Board since 1982 as a State Bank appointee.  He had been O’Neill’s direct boss when O’Neill served in the Banks Legal Department.   He was O’Neill’s stooge and when he assumed the SBS Chairmanship – the ‘conflict of Interest’ still existed.
  • In the 1988 Annual Report Kearns made false, misleading and contradictory statements relating to the SBS Treasury operations – the amount of the SBS profits – and little mention was made of the real reasons for Ken Dennewald and Denis Cleary’s dismissals.
  • The ‘conflict of interest’ reasons the Crown Solicitor and the Registrar used to prevent the merger option still existed when the sale to St George was struck – yet there was no opposition from any Minister or Department to see that the sale was reviewed under the terms of the Building Societies Act 1967 – and relating to ‘sale of a Building Society’.
  • Before the sale to St George could be completed – and to avoid any official review to the better option to protect the SBS shareholders and their equity – the Minister for the Office of Fair Trading had to sign off on a reversal of their Merger opposition and approve the sale to St George.  The ‘Office’ had to approve the bypass of a ‘Review Committee’ investigation into the St George sale option.   To facilitate this ‘review’ bypass – Minister Peacocke officially received a personal request for this ‘review process’ to be overlooked from Premier Greiner just three weeks before the SBS AGM – at which the St George buyout was to be voted on by SBS members.
  • There had been no other option considered – including a much fairer option for the SBS members to buy out the $3 million value of ‘fixed-capital’ owned by the State Bank.   If this option had of been considered the SBS members would have remained a very viable entity and continue to strengthen the Building Society Industry in NSW.
  • In fact – the whole $70 million sale price to St George was just for the ownership of the State Bank owned ‘fixed-capital’ – and part of the deal was that St George would assume ownership and control of the ‘fixed-capital’.  Included in the AGM agenda was a prepared resolution to abolish the ‘fixed-capital’ after the sale to St George was approved – this resolution was to help wash evidence of the alleged FRAUD away.
  • The ‘conflict’ in this fixed-capital ownership arrangement was structured by the then Premier Neville Wran when the SBS was first formed in 1982.   The Registrar at the time – [David Horton, served 1978-83] – had to sign off on the 1982 deal and it was done without any real legal oversight.  This conflict was contained internally at the SBS for as long as Cleary believed he was going to receive the State Bank CEO position after Whitlam’s tenure expired.  When Cleary was duped – this whole ‘conflict’ issue opened a can of legal worms that nobody wanted on their desk or deal with.
  • The alleged fraud had many components – all arising from O’Neill’s poor Bank decisions as the new State Bank CEO.  Prior to him assuming the role of CEO the Bank had a healthy Balance sheet.   The $400 million windfall from the CSB and SBS settlements was not enough to cover the mounting State Bank losses – however is was enough at the time for O’Neill to have time to form a plan to hide the State Bank losses.
  • All these actions allow the statement that O’Neill is an ‘evil’ person, and someone whose post State Bank career is all something that was based on lies, deceit and the alleged FRAUD.  The direct  allegations pertain to this alleged FRAUD include –
  1. The SBS sale to St George for $70 million plus interest had conditions that allowed for St George to issue St George shares to SBS shareholders where the SBS shareholders were entitled to St George shares based on their shares in SBS – they had to pay St George for their entitlements.  This meant that the SBS shareholders were buying back the SBS capital they owned and allowed St George to offset their $70 million paid to State Bank.  This constituted a FRAUD on the $1.5 billion worth of SBS shareholders.
  2. The SBS Treasury earned $25 million in profits during 87-88 – as compared with $5 million in Group profits over all the previous years.  This Treasury profit was subject to an agreement that would have seen all SBS staff share in a staff bonus scheme approved by the sacked Chairman and CEO.  When O’Neill dismissed these Executives – he also quashed the Bonus Scheme.  That took $8 million out of what was to be SBS staff bonus payments and put that back into retained earnings – that allowed the State Bank to negotiate a higher value for the capital reserves of the SBS.  That is FRAUD.
  3. O’Neill himself received employee Bonus payments for his FRAUD – the State Bank received a windfall of $75 million for the SBS $3 million in fixed-capital.  In the 1988 State Bank Annual Report the Chairman goes to great length to explain the most satisfactory outcome of the SBS sale.   That is FRAUD because O’Neill used a FRAUD to gain personally and protect his bad Bank decisions.
  4. In 1988 the State Banks of Victoria and South Australia went under – the SBNSW should have also gone under.  Instead O’Neill told staff to hide non-performing assets – by the early 90’s these losses amounted to $1.8 billion  and the Bank was technically insolvent yet continued to trade until sold to Colonial Mutual in 1995.  That sale was minus all the $1.8 billion in non-performing loans plus all other suspect loans – these assets were transferred to the NSW State Treasury and off the books of the State Bank.  These bad debts remain with the NSW taxpayers as part of their annual funding commitments.  These debts were O’Neill’s responsibility and his criminal activity in hiding these debts for all those years as the CEO – should have had him serving a custodial sentence.    That is FRAUD.

There are many more lesser FRAUDS included in this matter – these relate to falsifying Management reports for advantage – career ruination through the media – false accusations to the media to sway public opinion – Legal Opinions being ignored by Government Ministers – using a position of authority for deception and intimidation purposes – and they all played a contributing part to the events that took place.   In one meeting with State Bank Department Heads – O’Neill was addressing the $1.8 billion in losses and was told directly that the State Bank was technically insolvent and wanted to know what he was going to do about it.  As a response he screamed at those in attendance that he was not going to the State Government to seek capital to try and fix the insolvency issue.  This meant that he, the Banks Auditors, The Banks Directors, and others who were aiding to cover the losses were all perpetrating a fraud on the NSW Taxpayers that they ultimately ended up wearing when the Bank was sold in 1995.

The extent of these $1.8 + billion losses were never exposed as a liability the NSW Government had to wear when the Bank was sold.  In fact – O’Neill has escaped thus far with his reputation intact.


Part II –

Part two will include links to Documents that prove what is stated above – it will have extracts from O’Neill’s tenure ending interview – it will give details about the 1931 events that lead to the reasons why the SBS was formed – it will once and for all prove what a ‘grub’ and ‘scumbag’ John O’Neill is and how his whole career was forged on the back of an alleged FRAUD, and how he ruined 1000’s of careers because he could not fall on his own sword and take responsibility for the State Bank’s losses under his watch.   This will once and for all prove John O’Neill is an ‘EVIL’ man.


Link to all previous chapters for –

“Human Evil Exposed – John O’Neill (CEO-ARU)” – The SBS Story


The EYE-BALL Opinion … Without Prejudice …

%d bloggers like this: