Confidential documents reveal Leighton Holdings corruption; Services sector improves, but remains in contraction: Midday Roundup

Construction company Leighton Holdings has this morning been forced to respond to allegations of widespread corruption, cover-ups and bribery following revelations in the Australian Financial Review.

The company says it’s cooperating with federal police in regard to the allegations directly involving Leighton Holdings former chief executive Wal King and his brief successor David Stewart.

Fairfax Media obtained confidential documents allegedly giving evidence that top company executives were aware of plans to pay multimillion-dollar kickbacks in Iraq, Malaysia and elsewhere.

Speaking to the ABC today, King said he was unaware of the activity in the documents, but would make a statement this afternoon.

The Fairfax documents unearthed a supposed culture of rewarding corruption and poor company governance.

In 2012, Leighton Holdings revealed it had previously self-reported a breach of its code of ethics to the federal police, but chief executive Hamish Tyrwhitt said at the time he would be “shocked” if there were any substance behind the breach.

Services sector improves, but remains in contraction

The performance of the Australian services sector improved in September, but according to the Australian Industry Group it remains in contraction.

The sector jumped 8.1 points on the AI Group index last month to 47.1, but remained below 50 which indicates the sector is still in contraction.

Across the sectors, health and community services continued to grow, up 1.9 points to 55.8, but cautious consumer spending continues to hamper growth in accommodation, cafes and restaurants, retail trade, and personal and recreational services.

Shares higher despite US shutdown

The Australian sharemarket has risen higher this morning despite soft leads from the United States where investors are still worried over the continuing US government shutdown, and the growing fear of a default.

The benchmark S&P/ASX200 index was up 39 points or 0.8% to 5254.6 at 11.50 AEST, while in the United States the Dow Jones Industrial Average fell 58 points or 0.4% to 15,133.1.


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