Obituary - Jack Grahame

Jack Grahame, solicitor and tax rorter ... RIP ... Grahame led a group of Labor stalwarts who took millions out of the revenue with a dodgy sales tax avoidance scheme ... Strangely, he resented criticism of his conduct ... Tax manipulation can bring out the nasty side in people 

Grahame: unrepentant (pic: Sue Paull)Memories of an old tax avoidance scam came rushing back when I read of the death of the old Sydney stager and solicitor, Jack Grahame. 

One is loath to speak ill of the dead, but I did tell this now dead person, when he was alive, to expect an unvarnished send-off from this organ. 

In 1985 Grahame, along with a former ATO official Len Briot, and an accountant Richard Brewer, were charged with defrauding the Commonwealth of $27 million in a sales tax rort. 

Len's son Geoff Briot was also charged. He had worked for foreign minister Don Willesee in the Whitlam government. 

Grahame and the Briots were members of and well connected in the Labor Party. Brewer had been at school in Sydney with the editor. 

Grahame, who was a partner in the law shop G.D Campbell & Co, and old man Briot devised and promoted the scheme, which involved the minimisation of sales tax on cars, caravans, boats, electrical equipment, whitegoods, and virtually anything you could get your hands on. 

The goods were given an artificially low value, so that sales tax was paid on 4.95 percent of the original wholesale price. 

The cars, boats, planes and caravans were on-sold between wholesaler and retailer companies, controlled by the accused and others. 

The taxable sale would take place at a very low price and this price was supposedly justified by using the goods as security for a temporarily created debt. 

Advice connected to the scheme came from Dawson Waldron. 

It was a clunky piece of artifice, yet the Briots, Grahame and Brewer made small fortunes out of it. 

In June 1986 Madge Arthur Riedel in the Local Court committed the accused for trial. 

Grahame and the Briots promptly challenged this in the Federal Court under the Administrative Decisions (Judicial Review) Act. 

Would you believe it, they struck gold with Marcus (The Mensch) Einfeld. 

The Mensch quashed Madge Riedle's decision, saying: 

"The public interest will certainly be favoured by not having to mount and fund a lengthy trial and possible subsequent appeals where it is clear that the prosecution case can or should not succeed." 

There was more in this vein. 

"The evidence is that these applicants are professional men, that the case is exceptional almost to the point of uniqueness, that the prosecution's fundamental allegation has fluctuated considerably, that it involves very difficult issues to present at a jury trial and is even more problematic for a jury to comprehend. 

The possibility of prejudice against operators of tax schemes hatched in a different era of official toleration and even of blessing but judged by the standards of today is high." 

The Commonwealth DPP appealed - in those days Ian Temby was at the helm - and like a sizeable proportion of Einfeld's findings this one was overturned. 

The Mensch: off his rockerTrevor Morling, Bill Pincus and Maurice O'Loughlin thought The Mensch was off his rocker: 

"His Honour was seriously in error in using the Administrative Decisions (Judicial Review) Act procedure to review the whole of the voluminous evidence and to arrive at the conclusion that there was no 'serious evidence on which a properly and fairly instructed jury could reasonably' find guilty intent. 

This purely factual question should not have been the subject of review in the instant case." 

The appeal judges also rejected the notion that the case was "necessarily beyond the intellectual capacity of the average person". 

After losing that round, Grahame launched a relentless campaign through his lawyer mates and colleagues in the Labor Party to get the prosecution dropped. 

One lawyer close to the scene of the crime said he'd never seen anything like the amount of badgering and Chinese burns applied to the wrists of movers and shakers around town. 

Opinions from notable silks were flying in all directions. 

Grahame and the Briots changed briefs, dropping Ken Horler for Ian Barker. Michael Adams was to be the prosecutor. 

Adams and Barker knew each other well as a result of the Lindy Chamberlain case, in any event on the eve of the trial, on charges of defrauding the Commonwealth, the case was no billed by the DPP. 

It was all over, bar the shouting - and shouting there was. 

Grahame was incandescent with rage that he had been criticised in Justinian and elsewhere and, showing his well developed spleen, made a point of spraying abuse and profanities at your editor in public and private. 

His eyes bulging and his face engorged he screamed depravities from the floor during a panel discussion on some unrelated worthy topic in which your editor was delicately participating. 

The room froze as the tirade continued. We are unable to repeat it in a family oriented organ such as Justinian. 

Maybe, he felt betrayed because earlier he tried to cuddle up by inviting me out on his gin palace for a mid-week cruise on Sydney harbour. 

He'd purchased the boat from poker machine Czar Len Ainsworth, which attracted the attention of the police launch - the coppers thinking they could come alongside for free cocktails with Len. 

The whole time we were bobbing around drinking and lunching I was worried that in the style of the mob Grahame was going to tie an iron stove to my leg and shove me overboard. 

*   *   *

In September 1982 the Labor member for Cronulla in NSW, Michael Egan, raised the issue of sales tax rorting in state parliament.  

He went into the Grahame, Brewer and Briot scheme, chapter and verse. 

He told the House: 

"Mr Grahame has always liked to associate himself with good causes. At various times he has been a member and an office-bearer of the Penal Reform Council of New South Wales and the Council for Civil Liberties and is now vice-president of the Society of Labor Lawyers. He is also a member of the Builders Licensing Board. The third character is Mr Geoff Briot, son of Mr Leonard Briot, a former federal public servant and principal private secretary to a former Minister for Foreign Affairs." 

Egan ended his speech with a flourish: 

"Many investigations had been completed years before and no action was taken. The facts that no effective action was taken for almost three years, and no legislation is proposed even now to recoup the massive amounts lost in the past three and a half years, clearly indicate either massive corruption or inconceivable incompetence. 

Every honest citizen in this country is paying dearly for the laziness, incompetence and corruption of highly placed people in the bureaucracy and the Government. The parasites involved in these schemes have enriched themselves at the expense of the ordinary citizen. They have ripped off and shipped out billions of dollars. I assure the House that I shall pursue this matter until all of these billion dollar bloodsuckers, and all who have given them succour, are out of business and behind bars." 

After the conspiracy to defraud case was dismissed Graham, Brewer and the Briots kept a low profile. 

The other partners at G.D Campbell & Co suggested to Grahame that since he wasn't doing much work for the firm he might like to formalise his retirement. 

He got Michael Eyers at Dawson Waldron to threaten to sue the two other partners. 

Graham eventually re-emerged as a base grade solicitor working at the Prisoners' Legal Service. 

See earlier newspaper reports on the tax case here and here
 
Official obit here