“Gigantic Fraud” Denounced

Press, Volume CIII, Issue 30561, 2 October 1964, Page 14

“Gigantic Fraud” Denounced

(N.Z. Press Association—Copyright) MELBOURNE, October 1. The Labour leader, Mr J. W. Galbally, attacked Mr Stanley Korman and his fellowdirectors of Stanhill Development Finance, Ltd., in the Victorian Legislative Council on Tuesday and called for Government action.

Mr Galbally successfully moved the adjournment of the House to discuss the “failure of the Government to safeguard Victoria against the activities of certain persons in relation to companies.” The Country Party voted with Labour to outvote the Government 14 to 13. Mr Galballv said the recent interim report on Stanhill Deve'onment Finance, l td. and other comnenies by Mr Peter M>”’ r >hy. qc„ was “tragic.” “Mv thoughts turn towards the hundreds of thousands of ordinary neonle who earn their bread, nav their taxes, raise their families.” Mr Galba”v caid. “What must they think when they read that Mr Korman and his directors plundered the community for millions. and are living at liberty? “In squalor? No, sir. On the breadline? Of course not. The man at the head of the empire is living not lavishly, but munificently. And no action has vet been taken. Mr Galbally blamed the Government saying that the Premier, Mr H. E. Bolte, had encouraged the “Utonian atmosphere in which Mr Korma" flourished.” “There has been a debasing of the standards nf political and commercial life in Victoria.” he said. Mr Galbally said that when disaster struck, the directors’ storv was all too familiar—their unfortunate involvement was entirely one of those things which carried, if they were to be believed, no moral blame. The report was one of the most tragic documents laid on the table of the House The story was one of fraud on a grand scale. "These people knew in July, 1960. the game was up. Thev were without money. “They issued a statement, which in view of the facts was false, and with that false

pretence they were able to take £3m from unsuspecting people.

“No sooner had they got it than it was wheeled out. It had one objective—preservation of Mr Roman’s private fortunes."

The Minister for Local Government, Mr R. J. Hamer, said the Government was investigating what action could be taken to sheet home the responsibility of directors and participants in “this gigantic fraud.” The leader of the Country Party, Sir Percy Byrnes, said that until “fringe banking” was stopped this kind of thing would happen. To make directors responsible with their private means would “gum up” private industry because no-one would be willing to become a director. The debate was concluded.