Underbelly

by John Silvester

  It centred on two Sydney drug dealers named Salisbury and Powley, targeted by the task force and under close scrutiny.

  Coincidentally, Victorian police contacted the task force to say a man they had under surveillance in Melbourne was coming to Sydney to buy drugs from Salisbury and Powley, (later code-named JTF2 and JTF3 when they appeared at the Royal Commission.)

  It seemed a win-win situation for everyone except the two drug dealers. The buyer from Victoria, unknowingly purchasing drugs for the undercover policeman who recruited him, did not suspect that the serial numbers of the cash he was carrying had been recorded by Melbourne police, nor that he was under constant surveillance by the Joint Task Force in Sydney.

  He completed his drug deal at Sydney airport and returned to Melbourne, where he was immediately arrested. Back in Sydney, JTF2 and JTF3 were delighted with their quick and profitable transaction – but not for long. They were arrested before they got out of the airport car park.

  A search of their car produced two kilos of cocaine and a slab of hash, as well as two bags of cash – one holding $27,000, the other $14,400. It was enough to send the task force officers to look for more money and drugs at a Manly garage that JTF2 and JTF3 were known to use.

  When the police got to the garage, according to later testimony, their faces lit up. They had stumbled over Aladdin’s Cave. As the search began, one of the two arrested men knew exactly what would happen. ‘Someone will get a nice new brick veneer tonight,’ he predicted. Meaning, there was enough money hidden in the garage to buy a family size house – and the police were going to steal every dollar of it.

  He didn’t have to be Nostradamus. As well as cocaine and the usual drug paraphernalia, police found a briefcase they later said contained around $200,000. JTF2 would tell the Royal Commission it was actually closer to $280,000.

  The real figure could be either or neither of the above: it’s hard to pick a winner in any dispute about the relative truthfulness of crooked police and drug dealers. But there is no doubt it was $200,000 or more.

  Haken says the cash was brought to the task force headquarters in William Street, Kings Cross, where the marked money from Victorian police was isolated.

  The drugs and money from JTF2 and JTF3’s car were faithfully recorded as evidence. But the cash stolen from the Manly garage was given to Haken, who acted as paymaster and bundled it into individual packages with the recipient’s name on the front of each.

  Police who took part in the raid got $13,000. Others who had the night off got $1000. Haken said that included Detective Ray Donaldson, who would rise to be head of the squad before it was disbanded five years later. Although Haken was not physically involved in the raid, he also took $13,000.

  Unbeknown to other police and confirming the adage about not trusting a thief, two officers who drove the two drug dealers’ car from the airport to Manly found $6000 hidden under a seat and decided to split it on the quiet.

  Then a new problem emerged. The money designated for return to Victorian police was several thousand dollars short. Somehow, someone had double-dipped in the corruption payments.

  Haken says in Sympathy for the Devil that it took a frantic round of phone calls before the missing money was allegedly returned to the task force’s Dennis Pattle by JTF 16, Alan Taciak. Haken took no more chances. He drove to Pattle’s home to collect the cash.

  Haken says that as well as taking his $13,000 share, he gave similar amounts to Detective Sergeant Harry Bendt and detectives Taciak, Pattle, Terry Kilpatrick, Michael Tracey, Glenn Matinca, Frank Gillies, Chris Dent, Ian Lloyd and two detectives from other agencies.

  There was a nice touch of irony, according to JTF10, a rollover officer. He said the appropriately-named Bendt, the senior officer, tried to persuade three corrupt officers to give him their $13,000 cut for a share in a real estate deal he was organising. All three declined. ‘He would have ripped them off,’ JTF10 said.

  Haken says that Donaldson, Detective Inspector Ray Southwell, Detective Inspector Brian Meredith and former Australian Federal Police officer Richard Paynter were among those who took $1000.

  Police who thought they were entitled to a share of the money were unhappy with the distribution organised by Haken and they had a supporter in Donaldson, even though he got $1000.

  He would call Haken a ‘horrible, lashing (which means ‘ripping off’) little cunt’ when he learned years later of Haken again short changing colleagues with money stolen from a drug dealer.

  More than any other evidence of endemic corruption in the police service, the Joint Task Force disgrace made the biggest impact with the public.

  ‘We were worse than the criminals,’ one corrupt officer would admit – and no one disagreed.

  The Joint Task Force combined elite officers of the Australian Federal Police and the New South Wales police in a squad supposed to be the best of the best. It wasn’t. It was the worst. Not all police working in the squad were corrupt but there was a hard core of intractable officers out for what they could steal – from the minor to the massive.

  One officer in the ‘Christmas Club’ even staged a fake stab wound in his arm to collect as much as $10,000 of taxpayers’ money as compensation. And Haken organised for a new carpet in the Westfield Towers building (where the task force headquarters was) to be stolen and laid in his own home.

  Haken knew instantly he was with birds of a feather when, soon after arriving at the task force, he overheard Southwell telling colleague Richard Paynter about a sweet deal he had engineered: he had accepted $8000 from a drug dealer named David Kelleher to strip his name from a brief. Haken realised it did not matter where you served in the police, there was corruption to be found.

  The Royal Commission hearings would shred the JTF’s reputation, with revelations of lying, extortion, fraud, assault, theft, perjury, selling information about police investigations and ‘loading up’ people with drugs before charging them.

  In theory, the task force was a timely move to counter the flow of drugs being funnelled through Sydney to the rest of Australia. It supposedly recruited the brightest and best officers into an independent body with generous funding and high expectations.

  Instead, many officers simply merged their flair for criminal behaviour into an organised powerhouse of corruption.

  Their methods of raising illegal payments from criminals or just generating advantages for themselves were varied and ingenious. At one stage Haken sold Donaldson, the eventual boss of the unit, a stolen outboard motor for $100 after telling him it had been taken during a raid on an eastern suburbs house.

  Another time, Southwell damaged the suspension of his own sedan and simply swapped the damaged part with one from the police car driven by the unsuspecting Donaldson, who took the vehicle to a government garage where it was repaired at taxpayers’ expense.

  The brazen $200,000 Christmas Club sting was crude but it reflected the red-hot opportunism of corrupt officers inside the task force who would stoop to anything from extortion to perjury and straight-out theft to make money. Worst of all, they would sell out police investigations.

  The corruption network came crashing down after selected officers were confronted with evidence of their corruption, gathered through electronic surveillance and telephone taps. Their choice was to become undercover double agents for the commission to avoid charges themselves. A case of setting a thief to catch a thief.

  And no matter where the Commission headed in its inquiry into the JTF, the signposts of corruption invariably seemed to point at Donaldson and Lysaught, who were close friends and had followed tandem career paths.

  Donaldson, called the ‘Smiling Assassin’ by his troops, proved a man of hugely contrasting opinions. He privately attacked the Royal Commission while publicly endorsing it, then went running to the Supreme Court on a failed mission to suppress his name and the allegations against him.

  He denied all knowledge of any officers being corrupt then resigned (before he was pushed
), claiming his reputation had been butchered beyond belief.

  Arrogant and derisive about the Commission when it was first announced, Donaldson showed his true colours in a conversation with a colleague who had ‘rolled over’ and was wearing a recording device.

  ‘The whole fucking thing’s frog shit,’ Donaldson ranted. ‘This is a hundred million (dollars to run). It’s the WOFTAM Commission (Waste of fucking time and money). Any team of fucking galoots could have gone up to the Cross. It’s been going on for 100 years.’

  To the delight of the public gallery at the Royal Commission, Donaldson’s WOFTAM tirade came immediately after he had been in the witness box under oath.

  He was asked: ‘And there’s never been an occasion when you’ve done anything that a fellow policeman would take as a want of support for the Royal Commission by way of word or deed. Is that correct?’

  Donaldson: ‘Correct.’

  Counsel for the Commission: ‘Would you listen to this tape?’

  Donaldson could blink and swallow but he couldn’t run and he couldn’t hide. But he lied. A diehard believer in the quaint idea of the ‘big blue gang’ being invulnerable to any investigation if police remained staunchly united, he repeatedly denied everything. But it was too late.

  The gallows for Donaldson and Lysaught, the police commissioner’s chief of staff, was built on the plea of former officer Paul Deaves, who rolled over to become JTF7.

  Deaves broke down in the witness box as he shamefacedly detailed his corrupt behaviour, including a massive $100,000 scam on a drug dealer. He wasn’t alone in reaching for the tissues.

  By the time he had finished detailing the widespread corruption in the task force, the sixteen colleagues he’d implicated were in tears as well as they saw their careers crash and burn.

  Deaves became a weapon of mass destruction for the Commission, unhesitatingly naming fellow officers that he said acted corruptly, including Donaldson and Lysaught.

  He came into the hearing through the ‘roll-over’ door reserved for officers who had changed sides and his testimony burned holes in his previous dodgy evidence.

  He admitted he was corrupt, had accepted bribes in the past and had direct evidence linking other police with bribes from criminals. And he was willing to tell all.

  Deaves said his teenage daughter had begged him to tell the truth in the witness box, whatever the consequences.

  ‘You’re a policeman, dad,’ she had said. ‘You’ve sworn to tell the truth.’ So he did. His colleagues, facing the sack over charges ranging from theft to intimidating witnesses to perjury and drug dealing, thought he should have stuck to the adage that children should be seen but not heard.

  Deaves’ testimony was poignant, partly because it had to be so personally treacherous. He was a long-time personal friend of Donaldson and Lysaught, who was godfather to Deaves’ son. JTF6, another officer who rolled over, was also a close friend of all three men.

  That intimacy turned to ashes as the pair saved their own hides by switching sides and working undercover for the Commission. Deaves recalled the past and JTF6 captured the present on a recording device he wore into Lysaught’s office to tape conversations.

  Deaves revealed his and Lysaught’s involvement in a scam that extracted $100,000 from a slow-thinking cocaine dealer and a midnight rendezvous on a winter’s night to distribute the spoils.

  The pay-off came when two police cars driven by officers with no known interest in nature study pulled into Koala Park, a deserted tourist attraction at Castle Hill in outer Sydney. With only gum trees as witnesses, a white cloth bag containing $44,000 in bundles of $50, $20 and $10 notes was tossed from one car to Deaves in the other with the message: ‘Here’s your Christmas present.’

  It was actually mid-1987, not Christmas time, but the police calendar is elastic about such things.

  Deaves’ first reaction to the windfall was to phone Lysaught from a public phone and say: ‘Everything is sweet.’

  The police in Koala Park and the dozen or so others in on the rort were the dark side of Santa Claus. They were splitting $100,000 in cash they had conned out of a drug importer called John Murphy.

  Murphy, big in cocaine, thought he was buying his way out of being charged over millions of dollars worth of drug importations. He was a little optimistic. As Deaves would later reveal in the witness box, the task force had no brief on Murphy and could do nothing to help him – but the temptation to relieve him of $100,000 was too much to ignore.

  Murphy’s $100,000 offer was relayed to New South Wales drug officers Peter George and Chris Hannay who in turn, the Commission was told, passed it along to Lysaught and other senior police. Lysaught was named as the mastermind of the extortion scheme and a corruption conduit to his friend Donaldson. They even set up ‘think tanks’ to find a way to make it work.

  ‘During the course of discussions with Mr Lysaught it was decided that, as we didn’t have a brief on Murphy anyway, we were not in a position to charge him,’ Deaves said. ‘There was a discussion about basically distancing ourselves from the money and Murphy. I have a recollection Mr Lysaught and myself also spoke to Dick Paynter and Brian Meredith.’

  Paynter and Meredith allegedly drove the police car that arrived at the Koala Park and threw the money to Deaves – a charge they denied, along with other allegations of corrupt behaviour.

  Lysaught was the bagman. He took $17,000 of Murphy’s bribe for himself and another $5000 he said was for Donaldson. A total of $44,000 went to four officers with the remaining $56,000 divided between other police in the rort.

  With the ghosts of his past threatening him, Lysaught decided attack was the best defence at his first appearance before the Commission. It didn’t last. He had come into the hearing like a brass band. He went out like a tin whistle.

  He castigated the media for pursuing him and protested his innocence until counsel assisting, John Agius, dropped the stunning news that Lysaught’s office had been infiltrated and recording devices planted in it.

  ‘Mr Lysaught, I tell you now so that you may know and think about this,’ Agius said. ‘For quite some long time now (JTF6) has been assisting the Royal Commission by having meetings with people, including yourself, at a time when he was wearing a listening device.

  ‘The Royal Commission has those holdings and there are a large number of them and your voice features prominently. The Commission would like you to think about your position between now and the time you return to the witness box.’

  The realisation hit Lysaught like a bucket of iced water. He had been sold out by a man he trusted implicitly.

  Agius demanded an answer. Did Lysaught understand the situation?

  It was a bitter moment for Lysaught as he whispered, ‘Yes’. Having headed down a dead end by initially denying ever seeing or hearing of any corruption during their time in the force and sticking to their story, Lysaught and Donaldson had to sit like condemned men waiting for the trapdoor to drop as a black cloud of allegations burst over them.

  Surveillance and bugging, modern policing’s best tools, were being used to rid the modern force of some of its dinosaurs. Other tapes recorded secretly in Lysaught’s office and played for Justice Wood revealed officers pledging to hold their ranks at the Royal Commission.

  Deaves also said Lysaught had shared a $10,000 bribe with other corrupt police for not opposing a bail application by a Central Coast heroin seller.

  ‘Rollover’ officers told of Lysaught instigating an aggressive twelve- hour interrogation of a woman at Sydney airport and bullying her into signing a partly false statement he had compiled about her conspiring to import drugs even though none had been found on her person or in her luggage.

  Deaves said other officers involved in the case had met to go over the details to ensure ‘their statements dovetailed to make it look like it had actually happened.’ The woman was subsequently jailed.

  The allegations against Donaldson mounted until they were a noose around his neck. B
eing fingered for receiving money from the drug raid was just the start of his problems. Eye witnesses said he had also assaulted a man involved in heroin trafficking and then colluded with other officers to lie about the case in court.

  By this stage the supposedly rock-solid task force that Donaldson was relying on for support was fracturing fast. Realising their past sins were surfacing and confronted by Haken’s forensic memory and recorded evidence, guilty officers rushed to ‘roll over’ and tell their stories to the Commission to reduce the looming penalties.

  At one stage former squad members JTF1, JTF6, JTF7, JTF8 and JTF 9 were lining up behind Haken to give evidence. Then came J10 and J11. In poker it was a straight.

  It was JTF8 who revealed that Donaldson had assaulted an Asian cocaine dealer during a raid on a house in Kirrawee in Sydney’s south. It happened after police tracked imported heroin (packed into a car axle) to the house.

  JTF8 said the raid was more violent than he’d expected despite the fact the suspects found living at the house had shown little resistance.

  ‘It was a hard entry. The Asians living there were secured violently and pushed and thrown to the ground,’ JTF8 said. He admitted grabbing a man named Truang and slapping him before dragging him into the yard, where other police converged on him.

  ‘I recall the man (Truang) being hit across the face two or three times by another police officer,’ JTF8 said. ‘Hardhanded slaps to the side of the face. The man (a Vietnamese) was screaming and wailing as he was being bashed in the backyard.’

  Asked which officer had hit the man JTF8 replied: ‘Detective Sergeant Ray Donaldson.’

  The assault had also been witnessed by people next door. Unluckily for the cops, one of the witnesses was a retired fireman and lay preacher with an irresistible urge to tell the truth. ‘We didn’t know he was watching what went on,’ JTF8 said feelingly.