A family associate of Eddie Obeid lied to the Independent Commission Against Corruption (ICAC) to protect the former Labor minister's son, a corruption inquiry has heard.
Obeid family friend and business associate, Andrew Kaidbay, told ICAC on Wednesday that he gave false evidence to a private corruption hearing in March this year to protect Eddie Obeid's son, Paul Obeid.
ICAC is currently probing former Labor minister Ian Macdonald's 2008 decision to grant coal exploration licences in the area and how Eddie Obeid gained from it.
Mr Kaidbay said that at the private ICAC hearing he did not tell the truth about who paid for a lawyer to represent Gardner Brook, a former Lehman Brothers vice president, who also gave evidence to ICAC in private earlier in 2012.
Mr Kaidbay told the private hearing he received $22,000 cash from a friend to pay Mr Brook's legal fees, the inquiry heard.
Giving evidence, Mr Kaidbay said he made up that story to protect Paul Obeid.
'Name the person you were trying to protect,' counsel assisting the Commissioner, Geoffrey Watson, asked the witness.
'Paul,' Mr Kaidbay replied.
'Paul who?' Mr Watson then asked.
'Obeid,' Mr Kaidbay said.
Mr Kaidbay said before the private hearing Paul Obeid gave him a document that was subsequently shown to Mr Brook to 'help him with his recollection'.
It also heard that Mr Kaidbay was a key figure in a sham correspondence between two Obeid entities, United Pastoral Group (UPG) and Lockaway, aimed at manipulating the value of a Bylong Valley farm before it was sold to a mining company.
Asked by Commissioner David Ipp whether the exchange of letters was fake, Mr Kaidbay said: 'It wasn't genuine'.
Mr Kaidbay, who was the director of UPG, said the company had no assets and no bank account, and that he had no experience in coal mining in 2008.
He said had since 'bought a book' and now knew 'quite a bit'.
The inquiry also heard Mr Kaidbay admitted in private to ICAC that he had 'been used as a human face to disguise the financial interests of the Obeids'.
In contrast, he told the inquiry the Obeids' interests were kept hidden to protect their privacy and because their name could scare off potential investors.
Mr Kaidbay also said he had seen Eddie Obeid and Mr Macdonald together at a coffee shop near the Obeids' offices at Birkenhead Point, in Sydney.
The inquiry was also shown an email that Mr Watson suggested indicated the Obeids had moved to sell their stake in the Yarrawah coal tenement in the Bylong Valley for $40 million.
Earlier on Wednesday, ICAC heard another of Eddie Obeid's sons, Moses Obeid, had pushed to sell the property in the Bylong Valley for 15 times what it was worth.
Robert Stitt, counsel for investment adviser Richard Poole, put it to Mr Brook, the former Lehman Brothers vice president, that Moses Obeid made the comment at a meeting involving his client in 2009.
'There was a discussion about the multiple and Moses Obeid started off asking for 15 times the value of the land, did he not?' Mr Stitt asked.
Mr Brook said he could not recall Moses Obeid making such a statement.
Mr Poole was one of the original seven investors in Cascade Coal, which was ultimately the successful bidder in June 2009 for the critical Mount Penny tenement.
Cascade at a later date paid $30 million to the Obeids, the ICAC has been told.
The inquiry continues on Thursday.
