Each year BRW puts out its rich List which is way too soft on most of big powerful business types. Crikey likes to put our richest under a more questioning microscope and in this edition have added Mal Tunbull, Joe Gutnick, Doug Moran, Peter Scanlan and Billy Ireland.

Crikey is composing its own Rich List which casts a more sceptical eye on how some of these people became so rich.

There’s an old adage that “You don’t get that rich without shafting a few people along the way”.

If you’ve been shafted by someone on the Rich List we want to hear from you.

To make the Rich List you have to have something special, be it government connections, a great product, first mover advantage, brilliant marketing or an ability to rip people off.

Anyway, for the time being let’s pick through a few names on the Rich List and make a few observations about how they got there. After getting a taste for what we want it is over to you so send in your contributions to [email protected]

Kerry Packer: $8.2 billion

After inheriting a fortune from his father and arguably shafting his brother, Kerry Packer became the master at waxing fat off government rents and using his power, influence and connections to build a fortune. Remember when taxpayers spent $600 million sticking satellites in the air through Aussat in the 1980s. Well, Kerry Packer’s Nine Network was one of the biggest beneficiaries but did not pay a cent for it.

KP gets lucky dealing with subservient politicians and is also the master at making bucketloads out of sport. Dopey associations that don’t know the true value of their product have for years sold the broadcasting rights to good ole Kerry for a fraction of what they worth.

Once Kezza became Australia’s richest man he used this status to muscle his way into many lucrative start-ups on the ground floor. The culture in Sydney is such that the Big Man’s name alone can make your float fly so anyone with a decent idea goes cap in hand to Kerry. Just look at One.tel, Open Telecommunications and Looksmart.

The man who once shot at a chopper carrying former PM Paul Keating is also our most conspicuous consumer – $106 million in 1998 the story goes. This is something you can do when you manage your tax affairs brilliantly to keep it down around the 15 per cent mark.

Not only is Kezza rich, he is also a thoroughly decent god-fearing, loyal, happily married fellow who donates bucketloads to import charities such as individual casino croupiers.

Frank Lowy: $2.8 billion

Crikey’s favourite billionaire. Frank is like Kerry in the way he lines up all those pressure points that get in the way of him and a buck. No one deals with the NSW Right more effectively than good ole Frank. Keating even stuck him on the Reserve Bank board and gave him his former top adviser Mark Ryan.

Frank has had remarkable success over the years getting his way with government and councils where others have failed.

As Australia’s second richest bloke, Frank just can’t get enough and still rips about 6 per cent of net profit out of Westfield Holdings each year as his salary, which came in at around $7 million last year. At least James Packer has the decency not to draw a salary from PBL.

Speaking of upstreaming the profits, no-one does it better than Frank. The way he writes his own development contracts with the $5 billion Westfield Trust, in which he has no financial interest but complete management control, is one of the best lurks going in corporate Australia.

Always one to write out a cheque for a charity when it makes him look good, there is no-one in Australia who tries to manufacture public opinion like Frank.

Stooges speak in favour of controversial resolutions at his shareholder meetings, he paid Ken Hooper to create a bogus community group to campaign against a rival Sydney development and he cast Edna Carew aside from writing his biography because he wanted more control over the text.

All that bile said, Crikey takes his hat off to Frank for what he has done in the US and now the UK. He’s one of our few true corporate heroes but just needs to share the profits around a bit more, be a little more transparent and be nicer to critical shareholders at his AGMs.

Dick Pratt $2.7 billion

John Elliott saved Dick’s bacon in the 1980s and now Dick has spent much of the 90s returning the favour as “Pigs Arse” continues to balls up most things he touches.

Pratt has a great paper and recycling business and very pretty mistress and love child. He’s also an expert at extracting government subsidies and no-one has had more former politicians on the payroll than Dick. Hawke, Keating, Hamer, Rob Jolly and John Button are just the start.

The Federal and NSW together kicked in about $40 million in subsidies last year to help this battler get his new pulp mill at Tumut up and running. Even New York City through truckloads of subsidies and incentives at him for his recycling opertion in the Big Apple.

Hell, he really needed the help.

There has been no bigger supporter of the Liberal Party, Swinburne Uni, Carlton Footy Club or the arts but now it seems Dick is withdrawing from public life to concentrate on his billions, his mistress, his family and his love child.

Harry Trigaboff: $1.2 billion

The least literate person on the Rich List. Slap ’em up Harry has never written a mistake-free letter in Crikey’s experience. But he’s a damn fast erector of high rise flats for the masses though and is tracking at about 24,000 units a year.

Harry has also mastered that key ingredient of property development – the successful planning submission. How he’s done that over the years is anyone’s guess but we can all rest assured that Sydney’s council’s are full of highly commercial people who now how to deal with someone like Harry.

Oh, Harry is also a big political donor too, because he believes in supporting the process of democracy. Ahem.

John Gandel: $1.1billion

This billionaire would be nowhere but for Tricontinental (yep, Victorian taxpayers) lending him big dollars over the years. This is what former Tricon MD Ian Johns said about the quick approval given to Gandel in 1985 when he wanted to buy the huge Chadstone shopping centre from Myer.

“He actually had no money. But Myer were that desperate for cash, they were selling off their centres. All they wanted was an upfront cash payment, the rest was paid for through dividends.”

Come 1989 when interest rates were at 18 per cent and property prices were crashing, Tricon actually took over about $100 million in loans that Gandel had with other nervous lenders.

Talk to the Lowys about there excessive management fees at Westfield and they always point to the 0.6 per cent of assets that Modest John rips out of the Gandel Trust each year. This is a good point because it gives John a fundamental conflict of interest to buy up big through the trust which he has dutifully done in Brisbane over the past couple of years.

Gandel also goes close to taking out the Crikey Biggest House award with his $30 million effort in Toorak which attracted the attention of kidnappers about three years back.

Naturally, the house is absolutely tasteful and suitably understated. Not.

Gerry Harvey: $1.08 billion

One of the great self-promoters – maybe the closest thing we’ve got to Richard Branson when it comes to getting his name in the paper. Gerry Harvey is a very rich dial-a-quote who also runs a very successful speciality retailing business. He created the Norman Ross chain in the 1960s but Alan Bond bought Gerry and business partner Ian Norman out in 1982 and promptly sacked them with six months pay. They turned around and set up Harvey Norman and the rest is history. Gerry is a very colorful and at time an inspirational fellow. He has a variety of different franchisees in each story all given huge incentives to sell but also kept under a very tight rein. This, combined with Australia’s computer boom, turned him into Australia’s 5th billionaire.

Gerry’s wife Katie Page is Australia’s richest woman but just like Ian Norman, she leaves all the publicity to the very talented media performer in Gerry. When the tax office sent out probing surveys to 200 Rich List types hoping to scoop up an extra $200 million, it was Gerry who appeared on A Current Affair with Ray Martin and did a great job defending the rich in his knockabout way.

Gerry’s a keen horse breeder but gets big black marks from Crikey for being in business with that odious jerk John Singleton through the Magic Millions horse-auction company.

Kerry Stokes: $900million

One of the biggest drinkers on the Rich List but a tough and ruthless businessman all the same. The Victorian-born orphan is one of the few genuine Australian rags to riches success stories. Unlike most of those mentioned above, he’s not the classic post-war Eastern European Jewish migrant success story.

After getting locked out of the Seven float in 1993 by that airhead Ivan Deveson, Stokes raided the register in 1995 and has progressively sold most his other assets off or to Seven, with the exception of the lucrative Westrac franchise in the West which keeps his personal cash flow ticking over.

We’d love to know how much Little Kerry’s three wives got in the settlements and also how much Seven shareholders are paying for the corporate overheads of his private business Australian Capital Equity.

Like Big Kerry, Little Kerry will benefit enormously from getting the digital spectrum for free from the media-sensitive Little Johnnies in Canberra. He has also benefitted from the AFL’s lifelong inability to extract fair value from selling its TV rights to Seven. Maybe next time.

Solomon Lew: $805 million


Lindsay Fox: $370 million

Being one of the ultimate tough guys along with sucking up to the unions and his big business mates was the secret to Lindsay fox’s many millions. The bald trucker has long prospered on the four C-words – Caltex, CUB, Coca Cola and Coles Myer. A fifth C-word is also readily applicable to this bloke. Don’t get us wrong. He’s reaaaaaally CARING.

If you were big in the trucking game, the secret to success would be to stay friendly with the unions and the chairman of Australia’s biggest retailer. Surprise, surprise, Luvly Lindsay became best mates with Bill Kelty and his neighbour Solomon Lew, who thankfully was deposed from the Coles Myer chair after the Yannon scandal in 1996.

Lindsay is a member of the Young Presidents Association in the US which gives him a very colorful and powerful set of friends – including the world’s most famous developer of casinos, Las Vegan Steve Wynne.

Fox has a penchant for big houses and fast cars but thank god the neighbours in Portsea have rejected his heavy-handed attempts to create his own private court and beach.

Ron Walker: $315 million

He’s up over the $300 million mark this year thanks to a rumored $100 million thank you payment from GP supremo Bernie Ecclestone and his exquisitely timed $80 million exit from Packer’s PBL flagship at about $15 a pop. The pleasant two-metre red-head has celebrated by buying himself a new Ferarri and building himself a new mansion in Toorak which includes tastefully done giant busts of himself and wife Barbara as you walk in. Ugh. And whilst Ron continues to profit magnificently from these government-backed events and licences, he toils manfully for the community on things such as the Commonwealth Games bid and the GP Board – all of which he does out of the goodness of his heart and at no cost to the state.

At 34 the former chemical mixer and flogger was Melbourne’s youngest Lord Mayor and he is believed to be still shouting Jeff Kennett the odd free lunch, even though Jeffrey has been overhead referring to him as “turncoat number one” for co-operating with the Bracks government. With Hudson Conway now privatised, Crikey will not be able to annoy Ron or his former mate Lloyd Williams at any AGMs in the future. And we won’t be donating to the Liberal Party as long as Ron remains Treasurer. He really does soil the Liberal establishment our Ron.

Lloyd Williams: $310 million

It must really irk Lloyd that BRW reckons he is worth $5 million less than his former mate Ron Walker. After revelling in the lime-light as chairman of Crown for five years, Lloyd has slipped into obscurity after Jeff Kennett was voted out and Kerry Packer rescued his casino from collapse.

Many of his casino mates have moved on but Lloydie, who started out life as a real estate agent with Kate & Burton, remains one of Kerry Packer’s best friends.

Left with 15 million PBL shares and a $35 million golf course, many of us were expecting to see Lloyd dazzle the market with a series of new and exciting corporate plays.

Alas, his only conspicuous investment so far has been in Michael Kroger and Harold Mitchell’s emitch online advertising business. Lloydie even expressed interest in buying into Crikey at one point, but we were never really natural bedfellows.

Doug Moron: $300 million

One of the more odious characters on the rich list, as demonstrated by the court case this year in which his son’s widow sued Doug alleging he drove him to his suicide in July 1994. As BRW puts it: “The case was finally settled out of court, but not before allegations of violence, mental cruelty, infidelity, and wife-bashing involving Doug, his wife Greta and another son Peter.”

Westpac dropped a bundle on the Morons back in the late 80s but he’s now worth a lazy $300 million even though the bank is about $100 million the poorer. Same old story really, the big guys can get away with but if you’re a battler who misses a few payments on your mortgage, expect Westpac to send in the sheriff.

One of the nicer results of Jeff Kennett’s loss in Victoria was that the Morons missed out on winning a tender for about 1200 nursing home beds that the Libs planned to sell but Labor later cancelled.

Lang Walker: $295 million

One of the ultimate property hardmen. Count your fingers after shaking his hand if the number of court fights he’s involved with is any indication. Having floated his company for $1.50 a share about six years ago, Lang sold out for almost half that when the Asian-controlled Australand took over last year. He celebrated his $110 million cash payout by buying one of the world’s 40 largest yachts. He also splashed out by ripping the marble steps out of Melbourne’s famous and broke George’s department store and sticking them in his Wooloomooloo penthouse at the end of the Finger Wharf. How very Sydney of you Lang. Walker happily fixed up the cash for comment kings with apartments at the finger wharf which came in about six months late and millions over the $300 million budget. Alan Jones still raved about if, of course. Lang first got into business shifting dirt at his dad’s quarry and has spent most of his subsequent years throwing or being hit by mud in one way or another.

Greg Norman: $215 million

He just gets richer and richer as his golf gets worse. So, did Greg Norman put his corporate career and his colorful social life ahead of his commitment to golf. Could the tally have been more than two majors if he’d been more focused and also held his nerve on a couple of occasions when victory was in reach.

I guess we’ll never know but Norman has still picked up just $20 million in prize money which he has parlayed into a corporate empire which includes designing golf courses, luxury apartment developments with Macquarie Bank and his highly successful “Greg Norman Collection” line of clothes sold through Reebok.

Norman’s stake in NASDAQ listed Visual Edge has plummeted 70 per cent over the past 12 months but he still pockets a royalty by selling his one-on-one virtual reality golf lessons.

Norman is one of the few Australian sportsmen to have shunned Shane “pantsman” Warne socially. Warnie has dabbled in the corporate side of life but at least remained more committed to his key activity than Norman. Maybe this is why he has become one of the world’s truly great cricketers while Norman is an almost-truly-great golfer AND a very rich businessman before he’s retired from golf.

Peter Scanlon: $215 million

When Peter Scanlon was best man at John Elliott’s second wedding in 1987, little did he know that the market was about to crash and his entire career would be threatened by a $500 million contingent liability over shares in Elders IXL.

Ross Wilson, the then Southcorp boss now on easy street running Tabcorp, would attest to the fact that Scanlon fought hard not to get forced into taking these shares at pre-crash prices. Southcorp eventually took a haircut over this but given that the Elders boys had some storng influence over the affairs of related company Goodman Fielder, it was hard for Ross to really press the issue.

After this near death experience, Scanlon executed his exit from AFP in 1992, pocketing $60 million along the way. He then parlayed some of that into a 15 per cent stake in Lang Corp – the union-busting owners of Patrick Stevedores. It’s hard to work who got more screwed by the docks dispute – the workers or the taxpayers. Whatever happened, it wasn’t Lang Corp who paid out $200 million in redundancies to the workers yet it was Lang Corp that watched its share price increase four-fold once the dispute was settled. Scanlon’s 15 per cent stake is now worth $140 million and he’s entrenched on the Rich List.

Unlike Big John Elliott, Scanlon worked out that he should keep his mouth shut after the NCA case against them was thrown out in 1996. Scanlon was the brains and the money behind this particular Houdini act and must be furious that Elliott is still lashing at the NCA bees nest. All this does is further provoke the crime fighters who are now contemplating more charges over the secret $78 million profit Elliott, Scanlon and the boys made out of BHP’s purchase of a big parcel of Elders convertible bonds in the 1980s.

John Singleton: $110 million

Possibly the biggest jerk on the Rich List, Singo has made his bucks by simply being an uncouth ocker for the past 40 years. It is an indictment on this fine nation that a bloke like Singo has prospered in these circumstances. He sucked up to the Labor Party for years milking the working class heroes for many millions in fees. Amazingly, they won several election using his uninspiring ads and, thankfully, they’ve finally dumped him.

Singo got seriously rich being a 10 per cent shareholder in Channel 10 when Westpac sold it for the bargain basement price of $330 million back in 1992. There have always been rumors about who funded Singo into this stake. In something which is completely, absolutely and totally unrelated to this little theory, Singo is good mates with Kerry Packer. Along with Packer and Robert Whyte, Singo owned Manboom which controls many of the signs all over Sydney and also wanted to stick some uncouth flats up at the historic White City tennis club down near the Cruising Yacht Club. Thankfully, the feisty Paddington locals headed this one off at the pass.

Singo has Annie Keating on the payroll and some people reckons this is why she argued long and hard that Singo pick up the NRMA advertising contract. Thankfully it went to Saatchi and Saatchi rather than Singo’s firm which has got more than enough Qantas and Telstra troughs keeping it going.

Harold Mitchell: $105 million

Undoubtedly the fattest man on the Rich List, Mitchell weighs in at more than 20 stone but still has dozens of beautiful people in the media grovelling for some of his media buying. The Fat Man reckons he placed $650 million in ads last year and BRW notes that he gave up drinking at 23. When is he going to give up eating?

Harry floated emitch last year at the urging of slippery Mick Kroger and with all the big media players on the share register. The idea is that he’ll replicate his old world business model in the online world but after the 50c shares peaked at $3.75 they have done nothing but fall ever since and are now back around 60c.

The ad buying game is tough and bitchy and Harry fits in perfectly. Like many in the ad game, Fat Harry joined it straight from school when he left the northern Victorian town of Stawell aged 17 to start his 40 year climb to the top.

To make himself look good, Harry does lots of worthwhile charity work and is even president of the Asthma Foundation of Victoria.

Joseph Gutnick: $100 million

There is no way in the world that Joe Gutnick should still be on the Rich List. The plunging gold price, a poorly handled hedge book and a nickel plant that does not work have conspired to leave Joe on the edge of the financial precipice. Maybe if he hadn’t spent more than $20 million bailing out footy clubs, supporting charities and bankrolling politicians, Joe would be in better shape.

After selling the rest of his cash-cow, Great Central Mines, to Robert de Crespigny’s Normandy Mining, Joe has now sold a 15 per cent stake in Centaur Mining to Anacaonda at the knockdown price of 14c a share. Crikey was stupid enough to pay about 74c for his Centaurs but is relieved that Joe was even more stupid in paying about $1 a share for Tricontinental’s stake. Still, given that taxpayers dropped about $35 million on Joe, it would be poetic justice if he does go broke. Then the key question would be whether the Melbourne protestant establishment would reclaim their footy club and thank Joe politely for his $3 million bailout. Maybe the lectures to John Howard about the need to evict alleged war criminal Konrad Kalejs will stop because Joe will soon not be able to offer any politicians financial support. Crikey’s big prediction is that even BRW will wake up next year and drop Joe from their list. The next question is how soon it will be before he sells the corporate jet. Or has he already done that?

Bill Ireland: $95 million

A few years back Billy Ireland was not much more than a harmless Randwick pub-owner. Now he’s almost worth $100 million thanks to his booming Challenger International group.

Bustling Billy got lucky when his listed financial group Challenger International cottoned onto a goldmine in 1996 known as the endowment warrant. With the help of sacked National Mutual chief Gil Hoskins he also packaged up Solomon Lew’s heavily geared shareholding in Coles Myer to allow others to tap into the tax breaks. After these two smallish coups he then did what every smallish firm trying to get noticed did – he talked Kerry Packer into giving him some equity at typically knocked-down prices.

Since then he’s been on the prowl, picking up Citibank’s margin lending business and Deutsche Life. The Bell brothers have also got seriously rich out of Challenger’s rocketing share price and used this to fund the $40 million acquisition of Rupert Murdoch’s huge wool growing properties in NSW earlier this year. James Packer is on the Challenger board and we’re particularly looking forward to asking them some questions at this year’s AGM in Sydney.

Malcolm Turnbull: $90 million

Just like his uncle Robert Hughes, Malcolm has an amazing ability to be objectionable. A lawyer who turned himself into a merchant banker, Malcolm is famous for threatening to sue people. Someone who was better at dealing with people might have had more chance of persuading Australians to vote for a republic, but this is a cross that Mal must now bear for life.

When he and partner Neville Wran sold their boutique merchant bank to Goldman Sachs last year, Malcolm was made Australian chairman, much to the regret of Goldmans who have quickly discovered that most Aussie CEOs won’t deal with him. Just take your $20 million and go Malcolm.

He got onto the Rich List by astutely investing $1 million into Ozemail and then selling it for $60 million to US giant MCI Worldcom in 1998. If he’d waited another two years Mal might have picked up $100 million but you’ve got to leave something on the table for the next bloke.

He’s married to Sydney deputy lord mayor Lucy Turnbull and lives in an extravagant Point Piper waterfront right near Frank Lowy, another terrific bloke.

That’s all we’ve got time for this week. Grab a copy of the Rich List and send through your take on how some of them made their money. And there’ll be no BRW-style pissing in their pockets thank you very much.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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