Jeff McCloy

Jeffrey Raymond 'Jeff' McCloy is an Australian property developer, who was Lord Mayor of Newcastle between 2012 and 2014. He has a degree in Civil Engineering from the University of Newcastle. Before entering politics, he ran his own construction company, which built John Hunter Hospital. In 2008 he won the Hunter Business Chamber 2008 Business Person of the Year, and in 2009 he won the City of Newcastle Medal.[1]

Jeff McCloy
Lord Mayor of Newcastle
In office 8 September 2012 – 17 August 2014
Deputy	Brad Luke
Preceded by	John Tate
Succeeded by	Nuatali Nelmes
Personal details
Born	Belmont, New South Wales, Australia
Political party	Independent
Alma mater	University of Newcastle
Occupation	Chairman, McCloy Group Engineer

McCloy campaigned for the removal the rail line through the centre of Newcastle and, despite being nominally an independent, supported Liberal candidates in the Council ward elections.[2] Polling day in 2012 was marked by controversy when the running mate of an opposing candidate switched sides to support McCloy.[2]

In 2012, McCloy met the then Opposition Leader (and future Prime Minister of Australia) Tony Abbott to discuss the future of the Newcastle CBD.[3] In 2013, he held a joint press conference with Abbott and Newcastle victims of the Bali bombings in support of Abbott's proposed legislation to assist victims of terrorism overseas.[4]

McCloy opposed rainbow crossings in support of Gay rights, referring to them as "nonsense", and used council resources to remove them, despite claims they did not breach any laws. After Lake Macquarie and Cessnock councils expressed support for the rainbow crossings, McCloy attacked Cessnock as a "bloody mess" and threatened to arrange for Lake Macquarie City Council chambers to be "chalked with half a ton of chalk".[5]

McCloy appeared at a hearing of the Independent Commission Against Corruption 14 August 2014 relating to Operation Spicer, an investigation into allegations of corrupt conduct in relation to the 2011 elections in New South Wales.[6] He was recalled to give further evidence on Friday 12 September 2014.[7]

Tim Owen, the Liberal member for Newcastle, and Andrew Cornwell, the Liberal member for Charlestown, each admitted accepting amounts of $10,000 from McCloy. As a result, both Owen and Cornwell resigned from parliament on 12 August 2014.

On 17 August 2014, McCloy resigned as Lord Mayor of Newcastle, effective immediately. He said his resignation was due to ongoing controversy over his appearance before the Independent Commission Against Corruption, which he said "may effect [sic] the proper functioning" of Newcastle City Council.[8]

In 2015, McCloy's attempts to overturn part of a New South Wales Act of Parliament, enacted to prevent developers from making political donations, were rejected by the High Court of Australia.[9] The case was significant in Australian constitutional law, as it clarified the extent to which the Constitution of Australia provides an implied freedom of political communication, and expanded on the proportionality test developed in Lange v Australian Broadcasting Corporation.[10][11]

Corruption findings by Independent Commission Against Corruption

In 2016, The NSW Independent Commission Against Corruption released a report[12] on their investigation codenamed Operation Spicer. Operation Spicer was an 'Investigation into NSW Liberal Party Electoral Funding for the 2011 State Election Campaign and Other Matters'.

In 2011, Jeff McCloy, as a property developer, was a banned donor,[13] to parties and candidates in state elections as state governments have jurisdiction over land appropriations etc. in Australia. McCloy not only made political donations, he made so many large cash payments to Members of Parliament that he referred to himself in the Independent Commission Against Corruption hearings as a 'Walking ATM'.[14]

The NSW Independent Commission Against Corruption sought to prove that Jeff McCloy intentionally made covert payments to state government election candidates and that McCloy was aware that his donations were illegal because of his 'developer' status.

It was reported by the Sydney Morning Herald[15] that Cardiff vet Andrew Cornwell was in the middle of an operation on a dog when he was summoned outside by McCloy. McCloy handed Cornwell $10,000 in cash, cash that was later used to fund Cornwell's state parliament election campaign.

On 30 August 2016, the Newcastle Herald reported that MCloy called Independent Commission Against Corruption 'A $20m waste of time'. 47% of Fairfax's online respondents agreed with McCloy's view. McCloy described the factual findings against him as 'a parking fine, a speeding fine'.[16]

Correlation between the corruption findings and McCloy Group developments

Listed in the 'Principal Factual Findings made by the NSW Independent Commission Against Corruption in regards to Operation Spicer are the below references to Jeff McCloy.[12]

Finding Reference Group 1: Regarding The Seat of Port Stephens

Quote page 22 of the commission's report: "In 2007, Craig Baumann, the NSW Liberal Party candidate for the seat of Port Stephens, entered into an arrangement with Mr McCloy and Mr (Hilton) Grugeon to disguise from the Election Funding Authority the fact that companies associated with Mr McCloy and Mr Grugeon had donated $79,684 towards Mr Baumann’s 2007 NSW election campaign."

Finding Reference Group 1 Correlation with Development: Craig Baumann held the seat of Port Stephens in the NSW Parliament from 2007 to 2015. McCloy Group has developments within the Port Stephens state seat areas including The Bower (Medowie, NSW) and Potter's Lane (Raymond Terrace, NSW)

Finding Reference Group 2: Regarding The State Seat of Newcastle

Quote page 20 of the commission's report: "In about February 2011, Jeffrey McCloy gave Hugh Thomson $10,000 in cash as a political donation to fund Mr Owen’s 2011 election campaign for the seat of Newcastle with the intention of evading the Election Funding Act laws relating to the ban on the making of political donations by property developers and the applicable cap on political donations.

Quote page 21 of the commission's report: "Mr (Mike) Gallacher was responsible for proposing to Mr McCloy and Mr (Hilton) Grugeon an arrangement whereby each of them would contribute to the payment of Luke Grant for his work on Mr Owen’s 2011 election campaign. He did so with the intention that the Election Funding Act laws in relation to the prohibition on political donations from property developers and the requirements for the disclosure of political donations to the Election Funding Authority would be evaded..."

Quote page 21 of the commission's report: Mr Owen, Mr Thompson, Mr Grugeon and Mr McCloy were parties to an arrangement whereby payments totalling $19,875 made to Mr Grant for his work on Mr Owen’s 2011 election campaign were falsely attributed to services allegedly provided to companies operated by Mr McCloy and Mr Grugeon.

Finding Reference Group 2 Correlation with Development: Part a

Jeff McCloy and McCloy Group has ongoing commercial development concerns within the Newcastle State seat locality, including 'City Exchange' and 'Telstra Civic'. Both sites will benefit significantly from the highly controversial Newcastle Transport Interchange and Light Rail due for completion in 2019, a major infrastructure project implemented by the NSW Liberal state government.

Finding Reference Group 2 Correlation with Development: Part b

McCloy Group's 'City Exchange' is tenanted by a gym owned by Wests Group. Wests Group are a not-for-profit gambling entity that, according to its 2017 Annual Report[17]', made $143m in revenue in the year ending January 2017. As a group whose business interests are primarily involved in gambling, Wests Group are an illegal donor to political candidates in NSW, and as Lord Mayor of Newcastle and proprietor of McCloy group, incomes from Wests Group to Jeff McCloy or McCloy Group are considered indirect political donations.

Other Hunter Street property concerns

Relative to the highly controversial Newcastle Interchange, McCloy bought the Blackwoods property at Hannell St, Wickham in December 2006, the former Hunter Water headquarters at 591 Hunter Street in October 2007 (since subdivided, with the 591-address property sold and the 593-601 address retaining its heritage exterior), and a half shareholding of 356 Hunter Street in 2009.[18] 591 Hunter Street and 356 Hunter Street are multi-block buildings that are on the Light Rail route, planned for completion in 2019.

The Newcastle Herald reported that in late 2007, McCloy bought the former Toymasters building at 615 Hunter Street, which was sold by McCloy in 2009.[18]

As of December 2017, 615 Hunter Street is tenanted by the NSW Department of Family and Community Services. The address 615 Hunter Street Newcastle West is on the Light Rail route.

Also in late 2007, McCloy bought 'the former Churchills building' at 633 Hunter Street Newcastle West, which he sold in February 2015.[18] In 2008, McCloy bought The Lucky Country Hotel, now known as The Lucky, which was one of only two of his Hunter Street purchases that saw development under his tenure.

Over a ten year spending spree which included Hunter Street properties plus other holdings (a commercial property in Brown Street, a stately 'town' home in Church Street and Bolton Street's 'Legacy House' (now demolished and replaced with apartments) McCloy claims to have suffered $15.7 million in losses.[18]

References

1. "Newcastle Lord Mayor". Newcastle.NSW.gov.au. Archived from the original on 2 March 2014.
2. "McCloy to be Mayor". Newcastle Star. Archived from the original on 13 July 2018.
3. "Abbot and McCloy talk CBD revitalisation". ABC.net.au.
4. "TRANSCRIPT: Tony Abbott, Jeff McCloy, Jaimie Abbott media conference". The Newcastle Herald.
5. "Chalk rainbows a no-go for McCloy". The Newcastle Herald.
6. "NSW public officials and members of Parliament - allegations concerning soliciting, receiving and concealing payments (Operation Spicer)". ICAC.nsw.gov.au. Archived from the original on 16 December 2018.
7. McCloy v Latham [2015] NSWSC 1879 at [6], Supreme Court (NSW).
8. Nicholls, Sean; Gordon, Jason (17 August 2014). "Newcastle mayor Jeff McCloy quits before being pushed". Sydney Morning Herald. Retrieved 18 August 2014.
9. "Former lord mayor Jeff McCloy loses High Court bid to overturn developer donation ban". ABC News. 7 October 2015. Retrieved 12 June 2016.
10. McCloy v New South Wales [2015] HCA 34, (2015) 257 CLR 17 (7 October 2015), High Court.
11. Twomey, Anne (13 October 2015). "Proportionality and the Constitution". Australian Law Reform Commission. Retrieved 12 June 2016.
12. "ICAC Report August 2016: Investigation into NSW Liberal Party Electoral Funding for the 2011 State Election Campaign and Other Matters" (pdf). ICAC.nsw.gov.au. August 2016. Retrieved 28 December 2017.
13. "Prohibited Donors". NSW Electoral Commission. Archived from the original on 1 February 2016.
14. "'I feel like a walking ATM': Newcastle lord mayor Jeff McCloy admits giving tens of thousands of dollars to Liberal candidates". SMH.com.au. 15 August 2014.
15. "Corridors of Corruption". SMH.com.au. 16 August 2014. Retrieved 28 December 2017.
16. "ICAC a $20m waste of time - McCloy". The Newcastle Herald. 30 August 2016. Retrieved 28 December 2017.
17. "Wests Group Annual Report Jan 2017" (PDF). westsnewcastle.com.au. Retrieved 28 December 2017.
18. "McCloy lays property interests on the table". The Newcastle Herald. 6 March 2015. Retrieved 28 December 2017.