PNG-ISRAELI BUSINESS CONNECTIONS INVOLVING THE CORRUPT PETER O’NEILL

By Former Policeman

INTRODUCTION

Sometimes little clues are all we’ve got when we try to investigate the actions of cunning criminals.  The mafia network that Peter O’Neill created to build his financial empire so quickly seems held together by various glues consisting of multi-million kina secret “rewards”, covered up by endless lies.  It is the responsibility of all good citizens who believe in the divine laws of truth and justice to never give up making sure that all the secrets are revealed regarding deals being made by the most corrupt Prime Minister our country has ever known.

Never give up, never give up, in looking for the small clues and seeking the truth.  That’s the spirit for any true PNG Nationalist or Patriot.  Persistence, persistence, persistence in seeing that justice is done.  The corrupt in PNG have never felt afraid of being discovered.  It’s high time we start making them frightened to death since most of them will obviously never go to jail for their crimes.  

A MYSTERY PNGBLOGS COMMENTOR

The Peter O’Neill investigation I will be reporting on got started last Friday (27 June) with 1 small clue:  2 comments posted a few minutes from each other attached to the article “We Will Rise Up – Monday”.  What caught my eye was the name of the person posting those comments. I couldn’t read their name because it wasn’t spelt in English or even Roman letters:   דבר האמיתי  and האמיתי.

The mystery commenter was defending Peter O’Neill, very concerned that the UBS loan was portrayed negatively. 

FINDING OUT WHO THE COMMENTOR IS

Why would someone who was clearly not Papua New Guinean nor even Australian, be so concerned about PNG, much less the UBS loan?  I got my possible answer from one replier to the mystery poster, who accused the mystery person of being an “Israeli kickback recipient”.  

That motivated me to visit the web page “translate.google.com” and copied and pasted the strange letters into the translation search engine. Google responded that the language was Hebrew (language used by Jewish people living in Israel) and this is what the words meant:

דבר האמיתי   =  “The Real Thing”
האמיתי = “Real”

So those were the pen names our mystery commentor was using.  I noticed that Mister “The Real Thing”/”Real” had written in one of the postings that if there had been no UBS loan then there was a good chance Oil Search would have been taken over by Arabs. That’s definitely something that would concern an Israeli.

Now everything was making sense.  “The Real Thing”/”Real” commenter on PNGBLOGS was an Israeli with good knowledge about the UBS loan and unhappy enough that Peter O’Neill was being rubbished that he posted 2 rebuttals.  This Israeli was no passerby who visited PNBLOGS by chance.  Anyone who has read PNGBLOGS for long can figure out that only a tiny percentage of visitors ever post a comment.  For this Israeli fellow to comment suggests strongly that he has a vested interest in promoting Peter O’Neill.

ISRAEL AND WHAT IT CAN OFFER PNG

PNG has always been good friends with Ples Blo Jisus and we all know that last year Peter O’Neill and invited (and uninvited) friends visited Israel.  Since then he has courted Israelis to come do business in PNG.  Using his famous talent for tricking and deception, O’Neill portrayed the Israeli connection to PNG Christians as in some way strengthening PNG’s commitment to Christianity.  This capitalised on the general PNG ignorance about Israel, namely that:

Israel is not a Christian country but the world’s only Jewish country.

Jewish people do not accept Jesus Christ as the Son of God.  They consider him as a mere mortal, just like atheists do. 

The real reason that Peter O’Neill was courting Israel seems to be the same answer we always learn about our Prime Minister:  It was all about making money.

Is Israel a good ethical role model for PNG’s own economic development?  Consider these facts:

Israel ranks LOW AMONGST DEVELOPED WESTERN COUNTRIES in Transparency International’s corruption index (www.i24news.tv/en/news/israel/society/131203-israel-ranks-in-bottom-half-of-corruption-index).   In 2013 Israel had a 61 rating, worse than the United Arab Emirates (including Dubai), the African country of Botswana and the South American country of Uruguay, as well as all those countries we normally label “developed countries” (except for Italy, Spain and Poland, which are ranked as being more corrupt).   73% of Israelis believe that their government is ruled by insiders promoting special interests.   Israel’s 61 corruption rating is far below that of Australia, with its 81 rating (9th least corrupt country in the world) and New Zealand, with its 91 rating (2nd least corrupt country).  By comparison, PNG’s rating is 25. 

Former Israeli prime minister Ehud Olmert was recently sentenced to 6 years in prison for taking bribes (www.reuters.com/article/2014/05/13/us-israel-olmert-idUSBREA4C05L20140513).  That hasn’t even happened in PNG! (yet).

Stories of business kickbacks and bribes in Israel appear frequently in their media (www.jta.org/1972/11/08/archive/charge-vered-paid-6m-in-bribes-israel-officials-got-kick-backs).  Just this month the Jerusalem Post ran an article “Will Corruption Undo Israel” (www.jpost.com/Opinion/Op-Ed-Contributors/Will-corruption-undo-Israel-355625).  Some quotes:  “In the past decade, a former president, several ministers, mayors, high officials, bankers and others were incarcerated for the abuse of power and for corruption.”   “Like some Eastern European countries, Israel has contracted the disease of a corrupting collusion of politics with big money.”  “Israel, with its exceptional human capital, should have become one of the wealthiest countries. Instead most Israeli workers earn monthly about $2,600 while prices of goods and services are double the USA’s.”

From all this, it would seem that greater Israeli business influence in PNG might not be good news.   But under Peter O’Neill, Israeli influence has dramatically grown.

For some time now there has been growing suspicion that not only Peter O’Neill, but many politicians regularly get secret kickbacks in return for contracts and business deals. The K6 billion Chinese EXIM bank loan to the PNG government for infrastructure constructed by Chinese government owned Chinese companies is particularly suspect for involving massive kickbacks, particularly in regard to the proposed Lae-Nadzab 4 lane highway originally costed out at an unearthly K300 million.
  
But Israeli companies are no strangers to the corrupt world of kickbacks.  Some recent examples:

www.psychsearch.net/israeli-psych-drug-maker-paid-kickbacks-to-chicago-psychiatrist-michael-reinstein-must-pay-27-6-million-to-settle-charges/

www.upi.com/Business_News/Security-Industry/2012/03/09/Indian-ban-hits-Israels-defense-industry/UPI-50531331315614/

www.haaretz.com/print-edition/business/u-s-files-suit-against-discount-owner-for-accepting-kickbacks-1.4648

www.nypost.com/2009/04/24/israeli-link-to-pension-scandal/

www.haaretz.com/news/u-s-indicts-four-israelis-in-international-bribery-case-1.261760

All this should be of grave concern to those of us in PNG who are honest.   

THE ISRAELI COMPANY CALLED LR GROUP

Let’s turn to one Israeli company now doing business in PNG:  the LR Group. We all read about the government’s initially secret purchase of 2 generators for Port Moresby and Lae from the LR Group.  In a leaked directive, Peter O’Neill told acting Treasurer Mr. Dairi Vele to make the payment in December 2013.   Suspiciously, it took 2 months before O’Neill brought this deal before the NEC for approval, and other oddities have surfaced  (see  www.facebook.com/namorongmartyn/posts/528659657242831?stream_ref=). 

Who is this LR Group?  It’s a closely held company founded in 1985 by three former Israeli air force pilots ‏(Roy Ben-Yami, Eytan Stibbe and Ami Lustig‏). The company states that its headquarters are in Herzliya, Israel.  

Inside Israel, the only service that LR Group advertises as their specialty is the repair, service, and testing of elevator drives & MRL (machine room-less) motors.  

But outside Israel, LR Group seems to have the expertise to build and manage anything and everything.  For example, outside PNG they state that they not only engage in rural development and construction, and telecommunication infrastructure businesses, but also can build villages and renovate existing structures, construct farm buildings and community facilities, storage silos, produce processing plants, cow sheds, chicken houses, pig pens, schools, clinics, churches and roads.  They offer crop management, dairy farm development and management, and poultry farming related services. They say they can do cellular and satellite infrastructure; radio transmission equipment and infrastructure, with IT integrated solutions, including IT applications design other areas of expertise.  On one web site, LR Group says that they have interests in real estate, aviation and healthcare worldwide.” Through its “subsidiary” Karat Israel Ltd, LR Group “specializes in international trade management, offering credit lines arranging pre-finance activities, and guaranteeing purchase and export of the client's goods and services.  LR Group is additionally involved in civil engineering, supply, train, infrastructure, and cellular operations, as well as civil and military projects.”

Oh my!   Looks like this company can do ANYTHING!  But only outside Israel.  In its home country, LR Group isn’t even listed in any on-line Israeli phone books.  Its stated physical address in Israel is 11 Shenkar Arie Herzliya, yet on Shenkar Arie street, there are no physical addresses for numbers 10-15.   Maybe their office is at 16 Shenkar, but if so, they only have an office in a much larger office building containing lots of businesses. There is another LR Group office listed at 45 Natanya in Sokolov, Israel.  Unlike the Herzliya street address, this one is valid – but it’s an ugly plain concrete building that looks like warehouse and home to other businesses. You can see it all on Google Street View.    
Seems like LR Group has a very light, almost imaginary footprint in its home country, but is master of everything overseas, a middleman operation that relies on everyone else to implement their projects.  Most of their projects are in one African country, Angola. LR Group started its relationship there more than 20 years ago by selling the Angolan government weapons to kill their own people during a civil war. 

This is the company that Peter O’Neill so badly wants working in PNG. 

THE LR GROUP GENERATOR SCANDAL IN PNG

Last December, without going through the legally required tendering process, the PNG government gave LR Group K50 million to buy 2 large generators (what are they really worth?) that are obviously well used (HOW much used??) and which the owner, wanted to get rid of.  Whenever the world needs a sucker, PNG raises its hand. Originally the generators were supposed to come direct from the Israeli government’s “Israel Electric Corp (IEC) (equivalent to our PNG Power).  Suddenly the privately owned LR Group) became the middleman seller.  But they didn’t have to even put up the money to buy the generators, then find someone to resell them too.  The PNG government provided all the money needed, sent straight to LR Group. That’s how the generators were bought.  How much money did LR Group earn from that easy business deal?  The PNG government would have done better to buy brand new generators directly from the manufacturer, General Electric (an American company). It could have gotten the generators to PNG just as quickly and they would have lasted so much longer.  But why save money?   It’s not Peter O’Neill who will end up paying the price, it’s going to be PNG’s poor power users!

Peter O’Neill recently described LR Group as being at the forefront of Israel’s agriculture innovation and food security work.  That’s why he contracted them (were there competing tenders?) “to immediately develop a dairy farm and production project at the Ilimo Farm in the Central Province and an agro-industry project in the Morobe Province.”  Obviously our Prime Minister loves LR Group. It must have been love at first sight because of how quickly the contracts came to them!  But love is blind and the LR Group looks like little more than a networking company whose greatest asset is exaggerated self promotion and the ability to find expensive long-term consultants. 

Those foreign consultants who work for LR Group seem to really like the company because of the handsome pay and benefits it provides.  But they comment on more than just good pay.  Here’s what one former employee wrote:  “awesome benefits. Comfortable working hours. A very high level of leadership. Frequent traveling abroad. too much secrets.  Needed to be more open.”

“Too much secrets?”  Now we know why Peter O’Neill likes LR Group!

LR GROUP, AFRICAN LAND GRABS, AND CONTEMPT FOR LOCAL PEOPLE

One of LR Group’s secrets now out in the open is the company’s involvement in land grabs.   As we know, our country was extremely fortunate to escape colonial land stealing. We only lost 3% of our customary land before independence.  Yet in the past 7 years, we’ve lost another more than 10% through the sneaky land grab technique called “land leases”.   Land leases allow the lessee, not the lessor, to make the big money, since there is almost never a profit-sharing clause for the landowner in a land lease. Even when there is, the lessor takes care to manipulate the accounts so that there’s always little to no profit shown coming from the business activities on that land, hence little to no profit sharing with the landowner.  The corruption of land leases via the SABL process is what allowed foreigners and Papua New Guineans alike (including Beldon Namah) to steal and export, tax- and royalty-free, hundreds of millions of kina worth of hardwood timber logs, the benefits of which are now lost forever to the true landowners. 

LR Group likes African land.  In 2012 it grabbed a 2,000 hectare Rivers Farm Village venture in collusion with a Nigerian state government.  It also grabbed the Etche Agro Industrial Farm, in which LR Group coerced the local state government to put up 60% of the money.   Another recent LR Group prize was the contract to revive the agro-industrial area of ​​N'sele (DAIPN) in the Congo.

Examining LR Group’s recent agricultural deals, they seem to like the tired old strategy of taking land rights away from former landowners, then offering them low paying jobs in return, to slave away on their own land.  If the landowners turn up their noses in anger, the company brings in labour from other parts of the country to take the jobs.

LR Group has a short track record for agricultural projects, mostly because so many started only recently.  But the stories coming out of Angola about an LR Group agricultural project gives us a clue of what life will be like in PNG once LR Group gets established here: “Even though the Israelis transferred the project to the residents of Angola in a ceremony held at the end of 2007, it is clear that the great majority do not believe in the ability of the locals to manage their lives by themselves. Moreover, it appears as though the dependence of the local people on Israeli management makes it impossible for the latter to leave.”  “Many Israelis complain about the local residents' laziness, about their refusal to learn, and believe that the moment the Israeli company pulls out the entire project will crumble. Yossi (not his real name), who is helping residents to manage poultry farms, predicts: ‘The problem is that they don't really want that help. They are lazy, a lazy nation.’  “The impression gleaned from remarks by other staff at the project is not only that the Israelis do not expect the Angolans to manage their lives by themselves. The attitude of some of the Israelis appears to be outright contempt and gross racism. An engineer relates that he was asked to build a platform for the ceremony in which formal authority over the villages would be transferred to the Angolans. After he complained about a shortage of construction materials, his (Israeli) manager suggested that he bring iron beds and place a board on top of them."I explained to him that it is impossible to use iron beds on the grass, because they would sink into the ground and people would fall," the engineer relates. "His reply was, 'What do you care,' and finished with a racial epithet.  In other cases, the engineer continues, the disdain for the local inhabitants brought about construction of a very low standard. According to him, a senior LR manager explained to the workers that the long-term stability of the buildings was not necessarily the most important factor. "He told them that the most important thing was for the front to be painted well, so the paint would stick."”  (www.haaretz.com/high-times-in-angola-1.267252)

LR Group likes operating in the world’s most corrupt countries.  They operate in Nigeria, with a TI corruption index rating of 25 (just like PNG), but majority activities are in Angola, which has a corruption rating of 23.  The Congo where LR Group also rates is rated a lowly 22.  All these countries are oil/gas/resource rich so there’s lots of money around just waiting to be stolen.  Just like in PNG!

CONCLUSIONS

In summary, LR Group comes from Israel, one of the most corrupt of all the “developed western countries” in which many of its companies have been found engaging in bribery and kickbacks in their overseas operations.   LR Group seems to do mainly overseas business, and especially from some of the world’s most corrupt but resource rich governments.  That the LR Group can pay their employees so well is an indication of just how much money they make off the backs of the citizens of those developing countries.   

The real K50 million question, of course, is finding out the real source of what motivated Peter O’Neill to bring this company into PNG.  Let that question join the long line of other questions of dubious Peter O’Neill deals that must be investigated, if we ever get back our Sam Koim corruption fighting task force. 

Lastly, I have a personal message for LR Group:  PNG is the Land of the Unexpected and you may find out soon enough that we aren’t like Angola or Nigeria.  You might be able to bribe or pay kickbacks to our politicians but don’t be confident that your secrets will stay secrets in PNG.  As one of your former employers commented, your company seems to have a lot of secrets.  Maybe they’ll start spilling out in PNG.

ACKNOWLEDGMENTS

I did this investigation on my own, paying for internet time out of my pocket.  I’m always surprised that there seems to be not a single reporter at either The National or the Post Courier capable of carrying out these investigations.  Why these two newspapers persist in having such poor investigative reporting abilities is a question of interest the educated people of PNG would like to get answers to. 

However, I wouldn’t have even started this project if I did not for the unknown Israeli who made his mysterious appearance on PNGBLOGS last Friday.  I also want to thank our national Master of Disguise, King of Deception, Father of Lies, and Doer of Evil, aka Prime Minister Peter O’Neill, for never failing to provide yet another scandal to entertain us whenever we’ve grown tired of his last one.   Without Peter O’Neill our lives in PNG would seem boring and meaningless, our country rich, and our government worth respecting.