Sheppard band members’ father and former manager arrested in Papua New Guinea for alleged fraud

Greg Sheppard's law firm claimed that the charges are "politically motivated" and will be "defended vigorously"

Australian lawyer Greg Sheppard – father to three members of the band Sheppard and their former financier and manager – has reportedly been arrested in Papua New Guinea over an alleged $96million fraud.

Sheppard was arrested in the capital Port Moresby on Wednesday (January 20), The Guardian reported. He was charged with two counts of conspiracy and two of false pretence for allegedly defrauding a trust fund designated for impoverished communities that were impacted by the controversial Ok Tedi mine.

In a media statement made yesterday, the Royal Papua New Guinea Constabulary alleged Sheppard had misappropriated 268million kina (AUD$96million) from the Western Province People’s Dividends Community Mine Continuation Agreement (WPPD CMCA) trust fund.

The police allege the money was illegitimately deposited into the accounts of Sheppard’s law firm – Young & Williams Lawyers – and the Ok Tedi Fly River Development Foundation (OTFRDF). Two transactions totalling 52million kina were allegedly deposited in law firm’s account, and three totalling 216million kina were deposited in the OTFRDF account.

The trust fund was earmarked to funnel a portion of the profits from the Ok Tedi mine to development projects in the Western Province of Papua New Guinea, including schools, roads and hospitals assisting those impacted by the mine. The police statement notes these are “147,000 plus people emanating from 158 villages”.

“The Special Police Forensic and Criminal investigations (SPFCI) are currently continuing and the other directors of the OTFRDF and other suspects will also be brought in for inquiry into their alleged involvement in committing the fraud,” PNG police commissioner, David Manning said, adding that investigations remain ongoing.

“Police will also allege that the expenditures were not consistent with the spirit, tenor and intended purpose of the WPPD CMCA Trust Funds, and used for purposes contrary to the CMCA beneficiaries,” the statement continued.

The statement also noted that Sheppard was taken into custody at the Boroko prison in Port Moresby. The Guardian reported that he was released on bail of 3,000 kina.

A spokesperson for Young & Williams, the law firm that acts for OTFRDF and at which Sheppard is a partner, claimed that the charges are “politically motivated” and will be “defended vigorously”.

“One of our firm’s partners has been charged after he successfully fought the PNG Government on behalf of the OTFRDF to reclaim funds that belong to the people of the polluted region whose lives have been devastated by the pollution of the Ok Tedi mine,” the Young & Williams spokesperson said in a statement to NME.

“After our successful litigation we obtained court orders which allowed our client to take control of these funds. We have acted under the instruction of our client at all times and all transactions have been in accordance with the PNG court order.

“Young & Williams is the only major law firm in PNG that does not work for the government, and as such we are one of the only law firms willing to take legal action against the government on behalf of clients. The charges levelled against our firm’s partner are politically motivated and follow the PNG Government’s failure in the court system. The charges will be defended vigorously.”

Greg Sheppard and his wife financed the early success of the indie pop band Sheppard, and is the father to three of its members, George, Amy and Emma Sheppard. In a statement to NME, Michael Chugg and Andrew Stone said Chugg Music has managed the band exclusively since 2012 and before the release of their eponymous debut EP.

“We are sorry to hear about the difficult situation that the Sheppard family are facing with their father’s recent arrest in PNG, and we fully support the family during this tough time,” Michael Chugg and Andrew Stone said.

“The band has enjoyed extraordinary success in their touring, record sales and music endeavours. This is 100 per cent due to their hard work, running their own record label, and with the support of millions of fans across the world. It’s incorrect to suggest otherwise.”

In 2014, Greg Sheppard was appointed the director of Wilson Protective Services in Papua New Guinea, managing Manus Island Detention Centre. He reportedly resigned from the position in 2015 to protect his children’s band from association with his work.

In 2014, Sheppard was caught on camera by the Sydney Morning Herald providing advice to a prospective client – actually an undercover operative – on the “only way” to bribe foreign politicians.