Flugge fights to clear Iraqi taint

Megan NeilThe West Australian
The infamous photograph of former AWB chairman Trevor Flugge in Iraq in 2003.
Camera IconThe infamous photograph of former AWB chairman Trevor Flugge in Iraq in 2003. Credit: .

Trevor Flugge has been cast as a gun-toting crook when he should have been the flak jacket-wearing corporate hero who risked his life in war-torn Iraq, the former AWB chairman’s supporters say.

According to former Wesfarmers chief executive and chairman Trevor Eastwood, the Katanning farmer was tried long ago by the media and deemed guilty by a big section of the community.

Mr Flugge’s career as a professional director was destroyed by the Iraqi kickbacks scandal, Mr Eastwood said in one of numerous character references handed to a Victorian Supreme Court judge last week.

“The photographs that were published of him holding the gun have done great damage to his reputation with people who do not know or understand the circumstances under which it was taken,” Mr Eastwood said.

“His grandchildren were taunted by their school friends with words to the effect that ‘your grandfather is a crook, he bribed Saddam Hussein’.” Mr Eastwood said his respected ex-colleague had suffered excessively as a result of his actions or lack thereof.

He otherwise could have been recognised as “the corporate hero who put his life at risk by going to war-torn Iraq, living in un-air-conditioned hotels, not being allowed on the streets unless with being armed (sic) and wearing a flak jacket, to obtain important wheat contracts for Australian growers,” Mr Eastwood said.

After a nine-year legal battle, Mr Flugge was cleared of knowing about AWB’s $US223 million in sham payments to Hussein’s regime but Justice Ross Robson ruled he could have found out the truth and stopped the conduct if he had made inquiries.

The matter had taken a huge toll on Mr Flugge, his wife of 47 years, Lyn, said.

“I feel very sad that a man who left school at 15 and was able to reach such heights was cut off at the knees and left to languish for over 10 years,” Mrs Flugge said.

Mrs Flugge said she was not prepared for the “vicious and adversarial approach” taken by the Cole Royal Commission, “aided and abetted by an even more vicious press campaign”.

Former deputy prime minister and trade minister Tim Fischer said he found Mr Flugge to be a professional negotiator and competent businessperson.

Former WA deputy premier Hendy Cowan said the grain industry was poorer without Mr Flugge’s contribution.

“It disappoints me that regulatory authorities in this country chose to focus their prolonged attention on pursuing one of the few men doing all within his power to achieve the best possible outcomes for Australian grain producers,” Mr Cowan said.

The Australian Securities and Investments Commission wants Mr Flugge fined the maximum $200,000 and banned from managing a company for 10 years.

After a nine-year legal battle, a judge in December cleared Mr Flugge of knowing about AWB’s $US223 million in sham payments to Hussein’s regime but said he could have found out the truth and stopped the conduct if he had made inquiries.

Mr Flugge’s barrister Kanaga Dharmananda SC said the corporate regulator had failed in its fraud and dishonesty case.

“There were crooks within AWB and Mr Flugge was a crook was in effect how ASIC framed its case, and that case failed entirely,” Mr Dharmananda said.

A 10-year disqualification would effectively amount to a lifetime ban for the 70-year-old, he told the Victorian Supreme Court.

ASIC barrister Michael Colbran QC said information was specifically drawn to Mr Flugge’s attention and he did nothing about it.

He disagreed with Mr Flugge’s argument that it was a single, honest, unintentional mistake and a single incidence of failing to make proper inquiries.

“It was catastrophic,” he said. “It led to the demise of AWB. It led to the loss of the single desk.”

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