Flynn ‘blocked’ army move Turkey opposed

Days before President Donald Trump took office, incoming National Security Adviser Michael Flynn blocked a military plan against the Islamic State group that was opposed by Turkey, a country he had been paid more than $US500,000 ($A672,400) to advocate for, the McClatchy news service reports.


According to the report, Flynn declined a request from the Obama administration to approve an operation in the IS stronghold of Raqqa, effectively delaying the military operation.

His reasoning wasn’t reported, but Turkey has long opposed US military operations in co-operation with Kurdish forces.


At the time, Flynn had not yet registered as a foreign agent and disclosed that he had been paid to lobby on behalf of the Turkish government. Weeks after his firing, Flynn retroactively registered with the Justice Department.

News about Flynn’s activity comes amid intense scrutiny over his and other Trump associates’ potential contacts with Russia.

On Wednesday, the Department of Justice named former FBI Director Robert Mueller to be special counsel investigating Russian efforts to influence the US presidential election. Mueller will have sweeping powers, including the right to bring federal charges.

House and Senate intelligence committees are also investigating.

Trump fired Flynn in February on other grounds – that he misled Vice President Mike Pence and other White House officials about his conversations with Russia’s ambassador to the US.

McClatchy’s reporting reflects previous reports in The New Yorker and other media outlets about Flynn’s work on behalf of Turkey.

The military plan against the Islamic State stronghold was eventually approved, but not until after Flynn had been fired.


PM says alleged tax fraud implicating ATO deputy commissioner ‘regrettable’

But he’s congratulated the Australian Federal Police for cracking the conspiracy, with nine people arrested so far.


Australian Taxation Office deputy commissioner Michael Cranston, 58, has been issued with a court attendance notice for allegedly abusing his position as a public official.

AFP say Mr Cranston was not part of the syndicate, which involved his son.

“This is very much to be regretted,” Mr Turnbull told reporters in Brisbane on Thursday.

“Nobody should imagine they can escape our law enforcement agencies no matter how high they may be in a government department.

“No matter how high they may be, they are being watched.”

AFP give detail of the raid and charges

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The prime minister said the fact the alleged conspirators had been caught proved the system worked.

“We have zero tolerance for this type of conspiracy, this type of fraud, this type of abuse of public office,” he said.

“We have a relentless pursuit of corruption, malpractice, abuse of office, the AFP have a very keen focus on it … as has been demonstrated.”

Mr Cranston has not been officially been charged, but is due to face Sydney Central court next month.

Four ATO officers are also being investigated, said the AFP.

How this alleged $165m tax fraud syndicate operated

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Mr Cranston’s 30-year-old son, Adam, and 24-year-old daughter and seven other people were arrested over a $165 million tax fraud investigation.

Adam Cranston appeared via video link at Central Local Court on Thursday charged with conspiracy to defraud the Commonwealth.

He was released on bail as were two others also allegedly involved in the criminal syndicate.

A further two people are expected to appear at Central Local Court via video link later on Thursday.

Adam’s Cranston’s sister, Lauren Anne Cranston, is due to face court in mid-June.

Seized items are displayed at a press conference at the AFP headquarters in Sydney on Thursday, May 18, 2017. (AAP)AAP

The arrests were made following an eight-month investigation, codenamed Operation Elbrus, with assistance from ATO, Australian Federal Police (AFP) said on Thursday.

“The scale of this allege fraud is unprecedented for the AFP,” said Australian Federal Police Deputy Commissioner Operations Leanne Close on Thursday.

It is a significant fraud investigation, financial fraud criminal investigation, that the AFP has led since 2016.

Acting Commissioner of Taxation Andrew Mills told reporters in Sydney on Thursday Mr Cranston had “up until this point… held an illustrious career”.

“We do take it extraordinarily seriously and …it is of concern that a long- standing officer has been alleged to have been involved in this,” Mr Mills said.

The ATO was conducting an internal investigation into four officials into whether or not they looked at the material they were unauthorised to do so.

“If you are an officer within the ATO, you have access to those matters only to which you actually are required for the purposes of your job. If you seek to obtain information which is outside that scope, you actually are in breach of the code of conduct,” he said.

AFP Deputy Commissioner Leanne Close answers a question during a press conference in Sydney on Thursday, May 18, 2017. (AAP)AAP

Ms Close said it appears Mr Cranston’s son has asked him to access some information.

“We don’t believe that at this point that he had any knowledge of the actual conspiracy and the defrauding,” she said.

Assets seized in the past two days by the AFP include 25 motor vehicles – luxury, vintage and racing vehicles – 18 residential properties, 12 motorbikes, in excess of 100 bank accounts and share trading accounts, two aircraft.

firearms and jewellery, artwork, vintage wines and at least $1 million located in a safety deposit box.

Adam Cranston, 30, is due to face Sydney’s Central Local Court on Thursday morning charged with conspiracy to defraud the commonwealth, while his sister is due to face a Sydney court on June 13.

Adam was arrested at Bondi while his sister was arrested in Picton during 27 raids on homes and businesses across Sydney on Wednesday.

A further six search warrants will be executed on Thursday, said the AFP.

Federal Labor’s Chris Bowen said: “Of course it’s a disturbing case but the courts should be allowed to do their job; the course of justice and law should be allowed to proceed without political commentary.”

AFP officers make their arrests during the raid

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Former FBI chief Mueller to probe Trump

The US Justice Department, in the face of rising pressure from Capitol Hill, has named former FBI chief Robert Mueller as special counsel to investigate alleged Russian interference in the 2016 US election and possible collusion between President Donald Trump’s campaign and Moscow.


The move followed a week in which the White House was thrown into uproar after Trump fired FBI Director James Comey.

Democrats and some of the president’s fellow Republicans had demanded an independent probe of whether Russia tried to sway the outcome of November’s election in favour of Trump and against Democrat Hillary Clinton.

Trump, whose anger over the allegations has grown in recent weeks, took the news calmly and used it to rally his team to unite, move on and refocus on his stalled agenda, a senior White House official said.

“We are all in this together,” Trump told his team, the official said.

Trump said in a statement after the Justice Department announcement he looked forward to a quick resolution.

“As I have stated many times, a thorough investigation will confirm what we already know – there was no collusion between my campaign and any foreign entity,” he said.

Mueller said in a statement tweeted by CBS News: “I accept this responsibility and will discharge it to the best of my ability.”

Trump, who said in a speech earlier on Wednesday that no politician in history “has been treated worse or more unfairly,” has long bristled at the notion that Russia played any role in his election victory.

The Russia issue has, however, clouded his early months in office.

Moscow has denied the conclusion by US intelligence agencies that it meddled in the campaign.

Pressure on the White House intensified after Trump fired Comey, who had been leading a federal probe into the matter, and allegations that Trump had asked Comey to end the FBI investigation into ties between Trump’s first national security adviser, Michael Flynn, and Russia.

That raised questions about whether the president improperly attempted to interfere with a federal investigation.

The issue spilled over onto Wall Street on Wednesday, where the S&P 500 and the Dow had their biggest one-day declines since September as investor hopes for tax cuts and other pro-business policies faded amid the political tumult.

The Justice Department announcement came after the market close.

“My decision (to appoint a special counsel) is not the finding that crimes have been committed or that any prosecution is warranted. I have made no such determination,” Deputy Attorney General Rod Rosenstein said in a statement announcing the special counsel.

“I determined that a special counsel is necessary in order for the American people to have full confidence in the outcome,” he said.

Trump heard about Mueller’s appointment from his White House lawyer Don McGahn about 25 minutes before it was made public, the senior White House official said.

Trump assembled his inner circle in the Oval Office – Vice President Mike Pence, chief of staff Reince Preibus, economic adviser Gary Cohn, senior strategist Steve Bannon, and others – and gave them a pep talk, dictating the statement that was soon released.

Trump told them the appointment would allow them to refer questions to Mueller, giving them space to focus on policies such as tax reform.

Lawmakers on Capitol Hill generally welcomed the Justice Department action and praised Mueller for his integrity, but House and Senate Republican leaders said they would go on with their own investigations of the Russia matter.

“A special counsel is very much needed in this situation and Deputy Attorney General Rosenstein has done the right thing,” Senate Democratic leader Chuck Schumer said in a statement.

Republican House Judiciary Committee Chairman Bob Goodlatte said he was confident Mueller “will conduct a thorough and fair investigation.”

Mueller, 72, was decorated as a Marine Corps officer during the Vietnam War. A former federal prosecutor, he is known for his tough, no-nonsense managerial style. Appointed by Republican President George W Bush, he became FBI director one week before the September 11, 2001, attacks.

Mueller was credited with transforming the FBI, putting more resources into counterterrorism investigations and improving its cooperation with other US government agencies.

WA govt considers housing investor levy

Applying a $270 levy on West Australian investment properties through water rates would break a Labor election promise not to introduce new taxes, the state opposition says.


The state state government is considering applying the levy to investment properties with a gross rental value of $24,000 or more in an attempt to repair the budget.

But Opposition Leader Mike Nahan said if Labor went ahead with the idea it would be a “broken promise, without doubt”.

“In the election, the (now) premier and the treasurer repeatedly said no new taxes after they made, of course, the commitment to a tax on foreign investment on residential properties,” he told reporters on Thursday.

“This would be a tax on some of the lowest income people in the state … it will be passed on to renters.”

Treasurer Ben Wyatt said the levy was just one proposal put forward and the government was still making decisions about cost recovery and savings measures.

“I’m tyring to come up with a way forward that minimises the impact on the most vulnerable,” he told reporters.

But Mr Wyatt could not say how much money would be raised if the levy was implemented.

He indicated the state budget, to be handed down in September, would have a range of fee and charge increases but they would be announced beforehand because they needed to be implemented by July 1.

It comes after the state government announced on Wednesday it was slashing the $5000 boost to the first-home buyer’s grant six months early, with the grant dropping back to $10,000 after June 30.

One of WA’s largest home builders, Dale Alcock, said on Thursday that Labor had inherited a bad set of books and needed to make adjustments.

“I accept that we’ve all got to pull our weight but we’re not the only industry, and the construction and property market hasn’t been doing it great over the last two to three years,” he told 6PR radio.

Mr Alcock said the mining sector was “still producing pretty good profits” as opposed to the property and construction industry.

He said it all came back to the GST imbalance and WA was being “too civil” about it and people should be “marching in the street”.

Treasurer lays down challenge to big banks

The federal treasurer has urged at least one of Australia’s five big banks to break ranks and declare that they will not pass a new levy onto customers, in the hope the others may follow.


Scott Morrison accused Westpac, NAB, ANZ, Commonwealth Bank and Macquarie of “having a lend of people” over the $6.2 billion, four-year tax, and said they could afford to wear the cost.

He told reporters in Brisbane that the first bank to break ranks and absorb the new tax will get a lot of support from Australians.

“And if the other banks don’t want to follow them, then I’d be following the bank that is the first to move.”

Consumer watchdog chief Rod Sims has assembled a surveillance squad to work out how the banks calculate fees and charges on home mortgages to try and monitor whether the levy is unfairly passed on.

The Australian Competition and Consumer Commission will be given access to confidential bank emails, internal reports and other documents, and also have the power to hold compulsory hearings under oath.

“We don’t have the power to stop the banks doing anything but the fact we’re looking and have an obligation to report publicly will have an effect on their behaviour,” Mr Sims told ABC radio.

But federal Labor leader Bill Shorten said giving extra money to the watchdog to track the levy was a useless gesture because even the ACCC admitted it had no teeth.

He called on Prime Minister Malcolm Turnbull to explain to Australians exactly how much they will pay as a result of the new tax.

“What they need is a banking royal commission and Malcolm Turnbull’s too weak to give it to them” Mr Shorten said.

Labor has also accused the government of policy-on-the-run with apparent indecision about whether the levy will be imposed on foreign banks.

It followed comments by the treasurer’s assistant minister, Michael Sukkar, that he would not rule in or rule out extending the measure.

“In the next sitting fortnight you will see the legislation that has been well thought through and, as I’ve said, any good ideas along the way we will look at,” he told Sky News.

Meanwhile, Mr Morrison downplayed complaints from the big banks about having to sign a confidentiality agreement over legislation for the levy.

Australian Bankers’ Association chief Anna Bligh claims the government is going to extraordinary lengths to keep the tax hidden from those most affected by it.

“A bad tax has now become a secret tax,” she said.

But the treasurer said it was not an irregular practice, noting something similar was done for its multinational tax avoidance and diverted profits tax legislation.

“It’ll ensure that we’re able to work through the issues that we have, which are very minimal, so the legislation can be introduced on time,” Mr Morrison said.

“These are sensitive matters.”

Labor wants the draft legislation to be made public, with Mr Shorten accusing the prime minister of colluding with the banks about how the levy will work.

Philippines rejects European grants: EU

“The Philippine government has informed us that they (will) no longer accept new EU grants,” the delegation said in a brief statement.



The decision will affect grants worth 250 million euros ($278 million), according to Franz Jessen, the EU’s ambassador to Manila.

Philippine government officials did not immediately comment, with the finance department saying a statement would be issued later on Thursday. 

Duterte, 72, has repeatedly criticised European lawmakers and the EU for condemning his drug war, which has claimed thousands of lives and led to warnings from critics of a crime against humanity.

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In comments last year, he used vulgar language and raised his middle finger in a response to a European parliament statement expressing concern over the killings.

The German government also expressed concern after Duterte last year drew parallels between his drug war and Nazi Germany leader Adolf Hitler’s Holocaust.

“Hitler massacred three million Jews. Now there are three million drug addicts (in the Philippines). I’d be happy to slaughter them,” Duterte said, underestimating the number of people killed in the Holocaust.

Duterte later apologised for the Hitler reference but said he was “emphatic” about wanting to kill addicts.

Duterte easily won presidential elections last year after promising to end crime by killing tens of thousands of drug traffickers and addicts.

Police have reported killing about 2,700 people since Duterte took office at the end of June and immediately launched his war on drugs.

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Unknown assailants have killed more than 1,800 others, while about 5,700 other violent deaths are under investigation, according to police data.

Partly in response to American criticism of the drug war, Duterte has also loosened the Philippines’ ties with traditional ally the United States.

He has instead embraced China, which has supported his drug war and sought to deepen economic ties by providing billions of dollars worth of investments and aid to the Philippines.

Duterte, a self-described socialist, has also forged warmer relations with Russia, and will travel to Moscow next week to meet President Vladimir Putin.

Dateline: The Donald Trump of the Philippines

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Optus ups network spend as EPL costs weigh

Optus has suffered a hefty drop in full-year profit as content costs and competition weigh on earnings but the second-ranked telco has flagged a $1.


5 billion boost to its network spending after a favourable decision from regulators on roaming charges.

Optus says it will spend $1.5 billion over the next year to improve the capacity and coverage of its mobile network, mainly in regional Australia, after the competition watchdog decided not to change rules governing what mobile operators can charge rivals to access their networks.

The spending pledge came on Thursday as Optus reported an 11.8 per cent drop in full-year profit to $794 million.

Revenue and earnings for the 12 months to March 31 were hit by tougher competition in the business market, discounting on handsets and greater content costs arising from the 2016 purchase of rights to show the English Premier League.

The $189 million purchase was part of a multi-million dollar spend on content as Optus aims to protect and grow its subscriber base but profits have continued to decline in the wake of the EPL rights acquisition.

Optus said a regulatory cut to mobile termination rates also bit into profits.

At the end of March Optus’s 4G network reached 96.1 per cent of Australians and chief executive Allen Lew said that reach will expand.

“Over the next 12 months we will invest another $1.5 billion,” he said.

“The bulk of that $1.5 billion investment is going to go into regional Australia.”

Earlier in May the Australian Competition and Consumer Commission said it did not have enough evidence that declaring a wholesale domestic mobile roaming service would improve the current state of overall competition, particularly in regional and rural areas.

The decision at the time was a win for Telstra and Optus, which operate the biggest networks.

Mobile service revenue for the year fell by 17.1 per cent to $3.87 billion.

Prepaid mobile subscriber numbers rose 1.7 per cent to 3.74 million while Optus’s post-paid subscribers lifted 6.1 per cent to 4.95 million.

The average revenue per user (ARPU) per month for prepaid handsets dropped 18.6 per cent, to $21 from $26.

Monthly ARPU for postpaid handsets fell 19.6 per cent, to $47 from $58.

Optus said that in the fourth quarter, it had its strongest quarter of mobile handset growth in five years, gaining 78,000 postpaid and 64,000 pre-paid customers.

“Despite heightened competition in the Australian market, Optus’ strategy of delivering customer growth through music, TV and sports content, underpinned by a robust and resilient mobile network, is on track,” Mr Lew said.


* Operating revenue down 7.6pct to $8.43b

* Full-year profit down 11.8pct to $794m

Japan princess’s betrothal highlights male royal succession woes

Public broadcaster NHK broke the story of Princess Mako’s engagement late Tuesday, sending the country into a tizzy with the news dominating television chat shows and newspaper coverage ahead of an expected official announcement in coming weeks.


Her reported fiance, Kei Komuro, a telegenic 25-year-old commoner once named “Prince of the Sea” in a tourism promotion contest, briefly met journalists on Wednesday, but dodged questions on the engagement, saying he would only speak about it “when the time comes”.

The national rejoicing, however, has been tempered by concerns over the future of the royal family as the country prepares for its first imperial abdication in two centuries amid an acute shortage of male heirs. 

Mako, 25, is the eldest daughter of Prince Akishino, Akihito’s second son, and like all female imperial family members loses her royal status upon marriage to a commoner under a controversial law.

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The law does not apply to male royals, with Akihito and both his sons marrying commoners, who are now part of the monarchy.

The news reignites a debate on whether the law should be changed so women can continue in their royal roles in a bid to increase the chances of potential male heirs to a monarchy that does not allow females to ascend the Chrysanthemum Throne.

Traditionalists, including Prime Minister Shinzo Abe, strenuously oppose such changes, even though Japan has been ruled by female sovereigns in past centuries.

The government is currently preparing legislation to allow Akihito, 83, to abdicate in favour of his eldest son, Crown Prince Naruhito.

Following Naruhito’s reign, his brother Akishino and Akishino’s son, 10-year-old Hisahito, will be next in line.

But after that there are no more eligible males, meaning the centuries-old succession would be broken if Hisahito fails to have a son in the future.

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PM plagued by underemployment concerns

Concerns many Australians are not getting as much work as they would like have taken the shine off figures showing a drop in the jobless rate.


Australia’s unemployment rate fell to 5.7 per cent in April, official figures show, beating expectations of a flat rate of 5.9 per cent.

But while part-time jobs rose by 49,000, full-time employment fell by 11,600, the Australian Bureau of Statistics said on Thursday.

Labor claims the figures are evidence of a growing underemployment problem, insisting many Australians are struggling to find sufficient work.

Prime Minister Malcolm Turnbull says jobs growth is going strong, with growth in full-time and part-time employment during the past 12 months.

“The employment figures do move around a lot and we had strong growth in full-time employment last month,” Mr Turnbull told reporters in Rockhampton.

It is a view backed by several economists, who insist the April dip in full-time jobs should be viewed against the surge seen in March, when the economy added almost 75,000 full-time jobs.

Opposition Leader Bill Shorten says Australians are not getting enough work.

“1.1 million of our fellow Australians are complaining of being under-employed. They want more work,” he told reporters in Geelong.

Opposition employment spokesman Brendan O’Connor slammed the government for supporting cuts to penalty rates and increasing taxes at a time of record low wages growth.

“It is good for people to be employed but to have a job that might be two hours a week is not necessarily sufficient,” he told reporters in Brisbane.

“There’s no point in saying that people are in the labour market if you have in excess of one million people saying we can’t find enough work.”

Commonwealth Bank economist Gareth Aird said full-time jobs and part-time jobs were equally good as long as the part-time workers did not want to work full time.

But it was no coincidence that growth in underemployment had coincided with the trend towards part-time employment, he said.

“Growth in part-time employment, rather than full-time work, becomes a problem – and indeed undesirable – when there is growth in the number of workers who are not working as much as they would like.

“This is captured in the underemployment rate which is at its highest level on record.”

Australian Chamber of Commerce and Industry chief James Pearson told AAP the figures showed employers wanted to hire.

“Rising part-time employment is a natural feature of an economy undergoing structural change and as the Reserve Bank noted this month, part-time work is chosen by many people juggling responsibilities,” he said.

Concerns over record-low wages growth

Figures from the Australian Bureau of Statistics show wages rose by half a per cent in the March quarter, to be at 1.


9 per cent for the year.

And with inflation at 2.1 per cent, the cost of living is now rising faster than the take-home pay of many Australians.

Public sector wages are growing faster than those in the private sector.

And nationwide, Western Australia recorded the lowest wages growth, with Tasmania the highest.

Labor’s Treasury spokesman, Chris Bowen, says it’s a tough time for Australians.

“This is a time when wages growth is at record lows. In fact, today’s data confirms that wages growth remains at record lows and now, that wages are growing more slowly than the increase in the cost of living. Real wages in Australia are going backwards.”

Official figures show the mining industry was one of the worst performers with wages rising just 0.6 of one per cent.

In the public sector, professional, scientific and technical services recorded the lowest quarterly wages growth of 0.2 of one per cent.

Savanth Sebastian, an economist for CommSec, has this outlook.

“I think anyone wanting a pay rise in this environment has probably got to be a little more realistic. The environment we’re in is condusive to slow and weak wage growth and that’s likely to be the outcome over the next 12 months at least. It essentially means for businesses they can pass on these modest wage gains for the moment, and when profitability and activity improves hopefully we’ll get stronger wage growth down the track.”

Shane Oliver is the chief economist at AMP.

He’s told the ABC slow growth in wages, taken alongside high household debt levels, could slow down economic growth.

“That decline in real wages is another dampener for consumer spending. It’s a dampener for household income growth and it’s another reason why it’s hard to see the economy picking up just yet. Of course all of this has implications for the Reserve Bank, if we’ve got very low wages growth continuing, it’s hard to see inflation picking up on a sustained basis any time soon, which I think tells me there’s very little chance the Reserve Bank is going to raise interest rates any time soon. There’s more chance that the Reserve Bank will have to cut interest rates again.”

Savanth Sebastian agrees.

“Well if anything it means the Reserve Bank will keep rates low for an extended period of time. Wages do filter through to the inflation numbers and overall I just think it highlights that, at the moment, household debt is rising faster than household incomes. The Reserve Bank would be a little bit concerned about that. The longer it goes on, it adds more concern to the economy but for interest rates it means interest rates will be lower for longer.”

Sally McManus is the Australian Council of Trade Unions Secretary.

She says slow growth in wages and a lack of job security is affecting the lives of Australians, and not for the better.

“We see a whole generation who don’t know what a secure job is like and that’s not their choice, that’s the only jobs available and that’s not right. Then we’ve got a whole lot of other people that are seeing their jobs converted into labor-hire jobs or converted into ABN (Australian Business Number) jobs or casualised. That is affecting the stress levels of Australians. It’s also affecting their wages and it’s affecting our very way of life. If you can’t plan day-to-day because you don’t know what your hours will be, you don’t know if you’re going to have a job next week, that affects your family life, it affects our community life.”

Ms McManus has called on the federal government to do more.

“On the issue of wages growth, there’s three key things that the government can do now to do something about it. First of all, they can stop the penalty rates cuts that are due to come in on the 1st of July, that will make a huge difference. We can’t have low paid workers having their pay go backwards. Secondly, they can support a higher minimum wage, our minimum wage is now too low. And thirdly, they can show leadership. Their own employees haven’t had a pay rise for three years. They’ve had a pay freeze.”