Climate and integrity crusading independent federal MP Zali Steggall failed to disclose a six-figure political donation from the family trust of a multimillionaire coal investor, who is accused of tax fraud, for almost two years, an audit of her campaign financing has found.
An Australian Electoral Commission compliance review into Warringah Independent Ltd’s 2018-19 disclosures uncovered that a $100,000 cheque from The Kinghorn Family Trust, headed by prominent businessman John Kinghorn, had not been made public even though it exceeded the disclosure threshold.
Independent MP Zali Steggall has been an advocate for political donation reform.Credit:Alex Ellinghausen
Mr Kinghorn, founder of RAMS Home Loans, is facing charges over allegedly avoiding more than $30 million in tax and could face up to a decade in jail if found guilty. He has pleaded not guilty. The 80-year-old is a former investor and director of Cascade Coal and Felix Resources, which was sold to China’s Yanzhou Coal for $3.5 billion in 2009.
The AEC report, completed in February last year, found donations exceeding the $13,800 threshold were under-disclosed in Warringah Independent Ltd’s public returns. The full amount of the Kinghorn donation had been split into eight separate donations of $12,500 from Kinghorn family members, each of them falling under the minimum amount required to be disclosed.
The practice of donation splitting, when payments are divided into smaller amounts so that large payments can be concealed under the threshold, has been widely condemned by transparency advocates and donation reform campaigns such as GetUp, a strong supporter of Ms Steggall.
At the time, the financial controller of the fundraising entity was Damien Hodgkinson, who is now a director and shareholder of Climate 200 Pty Ltd, the campaign led by Simon Holmes a Court to fund climate-focused independents across the country.
The $100,000 pledge was the largest single donation of Ms Steggall’s campaign to oust former prime minister Tony Abbott from the blue-ribbon seat of Warringah, amounting to 9 per cent of the more than $1.1 million that was raised from several wealthy constituents and hundreds of community members.
Ms Steggall has been among the loudest voices in Federal Parliament calling for political donation reform, declaring in December last year that “for too long, money has been hidden from view and public scrutiny. Our democracy has been for sale”. On announcing her candidacy in 2019, she said Australia “can’t let coal companies and lobbyists buy their way into our government”.
But the audit into the finances of the entity established to bankroll Ms Steggall’s campaign last year found discrepancies in its record keeping. The financial controller of Warringah Independent Ltd provided investigators with eight individual pledge forms and donation receipts given to the Kinghorn family members for the $100,000 donation.
“Notwithstanding the donation consisted of eight individual pledges, one cheque of $100,000 was given to Warringah Independent Ltd from The Kinghorn Family Trust. Under the Electoral Act, the details of individual receipts exceeding the threshold must be disclosed in the annual disclosure return,” the audit report found.
Businessman and founder of RAMS home loans John Kinghorn.Credit:Jim Rice
The Kinghorn donation was received on March 28, 2019, two months after Ms Steggall announced she would challenge Mr Abbott. It was not included in Warringah Independent Ltd’s original 2018-19 annual return filed on October 21, 2019, and then amended in February 2020, by Mr Hodgkinson. A second amended return containing the Kinghorn donation, which named Richard Beck as financial controller, was lodged on February 22, 2021, following the AEC audit.
Records show Mr Hodgkinson ceased as a director of Warringah Independent Ltd on January 31, 2020, although he lodged the first amended return a month later. Mr Hodgkinson was contacted for comment.
Ms Steggall’s 2019 candidate election return, with two amendments, all lodged by Mr Hodgkinson, did not disclose the $100,000 Kinghorn donation. She was not under a legal obligation to detail individual donations above the threshold in her election return, since they were provided in Warringah Independent Ltd’s return. But she later personally disclosed the donation following the AEC audit.
Responding to questions from The Sydney Morning Herald and The Age, Ms Steggall said in a statement: “These are donations from a number of members of a large family who nearly all live in Warringah. If you ruled out taking donations from anyone who has invested in coal at one time or another, you pretty much rule out everyone as most people have through their superannuation.”
She did not respond to queries about the non-disclosure of the donations by Warringah Independent Ltd or when she learnt of the AEC warning.
The corporate trustee for the Kinghorn Family Trust is JA Kinghorn & Co Pty Ltd, registered to an address in Mosman. Records from Australian Securities and Investments Commission show Mr Kinghorn and his wife, Jill, are the only directors.
Mr Kinghorn told The Sydney Morning Herald on Sunday that he did not wish to discuss the donation, which he said was made “some years ago”.
The case against Mr Kinghorn, who was charged in 2017 following an eight-year investigation by the Serious Financial Crime Taskforce aided by international agencies, is still before the courts.
He was also previously a director of White Energy, a “diversified” coal company, from 2010 to 2013 but resigned after the NSW Independent Commission Against Corruption recommended charging him with breaching directors’ duties over his involvement in the Mount Penny mining licence.
Mr Kinghorn and his fellow White Energy board member, Travers Duncan, were investors in Cascade Coal, the company that purchased the exploration licence over Eddie Obeid’s family farm in the Bylong Valley. In November 2015, the NSW Court of Appeal cleared him of corrupt conduct, overturning an adverse ICAC finding.
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