Milne guilty of money laundering

MILLIONAIRE Sydney hotelier John Hemmes last night withdrew his offer to pay $100,000 as bail surety for his friend, the convicted money launderer Michael John Milne.

By InvestSMART · 20 Nov 2010

By InvestSMART ·
20 Nov 2010

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MILLIONAIRE Sydney hotelier John Hemmes last night withdrew his offer to pay $100,000 as bail surety for his friend, the convicted money launderer Michael John Milne.

Instead, the money will be provided by a general manager at Mr Hemmes's hotel company Merivale, allowing the millionaire Milne to be freed on bail to await his sentencing next month.

Milne was yesterday found guilty of money laundering and tax evasion as part of the Tax Office's Operation Wickenby.

The NSW Supreme Court trial heard that a complex web of offshore entities was "completely contrived and an artificial arrangement" designed to gain him a financial benefit.

Milne was a client of Philip Egglishaw, whose Swiss firm Strachans sparked the $300 million Wickenby investigation and he also had links to the inquiry's most high-profile scalp, music entrepreneur Glenn Wheatley.

Milne used Swiss bank accounts to buy antique French furniture, a $2.7 million house in Neutral Bay, where he still lives, a Bentley, a yacht worth $270,000 and a $440,000 painting by Jeffrey Smart.

Most of Milne's assets have been frozen under proceeds of crime laws. He was arrested nearly three years ago and found to have sent the proceeds of the sale of shares to Swiss banks and then either onwards to Australian bank accounts linked to Milne, or for purchases that benefited him.

Justice Peter Johnson continued Milne's $5 million bail, but added a $100,00 surety and a daily reporting condition at Mosman police station. The $5 million bail was provided by Milne's wife Liesa Marie Milne after his 2008 arrest, and the court heard Mr Hemmes would provide a $100,000 bank cheque to secure continuing freedom for his friend. This was later replaced, to be paid by Kerrie Boylett, who works for Mr Hemmes.

Crown Prosecutor Peter Hastings, QC, had opposed Milne's bail, arguing that he was a flight risk and had "overseas interests of a type which may be utilised to assist flight".

Justice Johnson said a custodial sentence for Milne was likely.

Milne is due to face a sentencing hearing on December 2.

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Frequently Asked Questions about this Article…

What was Michael John Milne found guilty of in the money laundering conviction?

The article reports that Michael John Milne was found guilty of money laundering and tax evasion as part of the Tax Office's Operation Wickenby investigation.

What is Operation Wickenby and how is it connected to Milne's case?

Operation Wickenby is a Tax Office investigation into alleged tax crimes. The article says Milne's conviction formed part of this probe, which grew from work by Swiss firm Strachans and involved high‑profile targets including Glenn Wheatley.

Which assets of Milne were identified and frozen under proceeds of crime laws?

According to the article, Milne used Swiss bank accounts to buy items including antique French furniture, a $2.7 million house in Neutral Bay where he still lives, a Bentley, a yacht worth $270,000 and a $440,000 painting by Jeffrey Smart. Most of his assets have been frozen under proceeds of crime laws.

How did Milne reportedly use offshore Swiss bank accounts in the scheme?

The article states Milne sent proceeds from the sale of shares to Swiss banks, and those funds were then either transferred on to Australian bank accounts linked to him or used to make purchases that benefitted him, including the assets listed above.

What were Milne's bail conditions and who provided the bail surety?

Justice Peter Johnson continued Milne's $5 million bail but added a $100,000 surety and a daily reporting condition at Mosman police station. The original $5 million bail was provided by Milne's wife, Liesa Marie Milne; John Hemmes had offered to provide a $100,000 bank cheque but later withdrew and the surety was provided by Kerrie Boylett, a general manager at Hemmes's hotel company Merivale.

Who is John Hemmes and what role did his company Merivale play in the bail matter?

The article describes John Hemmes as a Sydney hotelier and millionaire. He withdrew his offer to pay the $100,000 bail surety for Milne; a general manager who works for his hotel company Merivale, Kerrie Boylett, ultimately provided the $100,000 surety that allowed Milne to remain on bail pending sentencing.

What did the NSW Supreme Court say about Milne's offshore arrangements?

The NSW Supreme Court trial heard that Milne's web of offshore entities was described as 'completely contrived and an artificial arrangement' designed to gain him a financial benefit, according to the article.

When is Milne due to be sentenced and did the judge indicate the likely outcome?

The article states Milne is due to face a sentencing hearing on December 2. Justice Peter Johnson said a custodial sentence for Milne was likely.