Michael Pascoe writes:

Something very strange has happened in the
past 24 hours. The AFR yesterday ran a
most interesting front page story by Andrew Main that the HIH liquidator is
considering suing Malcolm Turnbull, among others, over the insurance company’s
scandalous crash – but the story has sunk without trace.

My skimming of the fishwrappers this
morning, including the AFR, can’t find it and a Google news search turns up
nothing. Here’s a parliamentary secretary to the Prime Minister, a potential PM
(or at least Treasurer, maybe), one of Australia’s more interesting public
figures, yet no-one else has touched an important story that could seriously affect his career, not to mention his pocket.

Crikey is guilty as well, but our missing
the yarn in yesterday’s wrap of the newspapers was merely a stuff up. What’s
the entire press gallery’s excuse?

Main reported that HIH liquidator Tony McGrath is considering proceeding
with a $400 million legal action against Turnbull, four other individuals and
three US corporations. He’s seeking compensation for HIH creditors. In 1998,
Turnbull was chairman of Goldman Sachs Australia
which advised the board of FAI Insurance on a $300 million takeover bid by HIH:

He is named
personally in the action, which was filed in mid-2004 but not served.

It is
understood Mr McGrath is preparing to serve the claim after a mediation of the
case late last year failed to reach a settlement.

While
he would not comment on the mediation hearings, Mr McGrath said
“investigations have revealed that we have solid and genuine claims that
need to be pursued”. The 10 defendants include Goldman Sachs Australia, Mr
Turnbull, his assistant, Russel Pillemer, former FAI chief executive Rodney
Adler, FAI finance director Tim Mainprize and FAI chief operating officer
Daniel Wilkie.

Insurer
General Re Australia and its German parent, Koelnische
Ruckversicherungsgesellschaft, reinsurance broker Guy Carpenter and Co and
reinsurer National Indemnity are also named in the action.

It is indeed an interesting story. Among
the questions raised are whether John Howard knew about this potential legal
action when making Turnbull a parliamentary secretary and whether it’s the
reason he was given his own ministry as his performance since entering
parliament has been particularly good – much better than just about anyone
predicted.

Main covered the HIH inquiry for the AFR, wrote a book on the disaster
and obviously continues to stay close to the aftermath. By way of disclosure, I
should record that Channel Nine paid an amount of money to Turnbull to cover his
legal costs and I had to read an apology on Business Sunday after making some
remarks about his performance with FAI.
I find it incredible though that we seem to be the only two people who apparently think the
McGrath action is important.

Can someone tell me what happened? Or
rather, why it hasn’t happened?