Gough Whitlam in Fremanlte before the loans affair helped to bring down his government.Gough Whitlam in Fremanlte before the loans affair helped to bring down his government.

Colin Nichol worked in British pirate radio with one of the key figures in the Whitlam government loans affair, which led to the infamous dismissal of a government. Now those documents have been released he recalls a conversation with him.  

IMAGINE my surprise when he sprung on me that he was a key figure in the infamous petro-dollars “Loans Affair” that lead to the 1975 dismissal of the Whitlam government.  

I hadn’t any idea of his connection.

It was London in February 1984 and we had finished lunch and the recording of his recollections of his part in the British pirate radio saga. That comment on a curious and infamous association just came out as a casual contribution to our subsequent conversation.

Pirate radio

Australian Allan Crawford had earlier been the original instigator of the enormously controversial world-wide sensation of the pirate commercial radio ships off the coast of Britain in the early Sixties. He revealed he again plunged into controversy by much later playing a prominent part in the $4 billion Arab loan negotiations and subsequent Dismissal.

Allan had been a WWII bomber pilot. He died in Wales in 1999, under sad circumstances. A music publisher in Sydney then Hamburg and London and subsequently with his own company, he wanted a means of publicising and selling his own production of pop records beyond the highly restrictive broadcasting regime of the time and came up with copying Scandinavian broadcasters transmitting from ships outside territorial limits. That was the start of the remarkable radio pirates of the Swinging England era.

He became go-between for Pakistani broker, referred to as international commodities dealer, Tirath Khemlani, central figure in the loans deal, and the then Australian minister for minerals and energy Rex Connor. Khemlani worked for a London-based commodity-trading firm. Their activities consequently lead to Connor’s own dismissal from Federal cabinet. The seismic events of the dismissal of the Whitlam government ensued.

Allan was an extraordinary man and it seems hardly surprising he turned up in the middle of this great controversy. His part in the history of the loans affair was widely reported at the time, but has faded since. But in my experience and observation, Allan had not always been a good judge of character; being deceived over the pirate Radio Caroline saga was a case in point. He placed his trust in the wrong man and paid the price of theft of his secrets on how to achieve broadcasting from outside territorial limits. 

They were used to beating him to be first on air.

In the epic dismissal case, he was unaware at the time his business associate was in this affair was rumoured to be in the pay of the CIA, or that in addition to them, other worrying acronyms were at work, including ASIO, ASIS. MI5, MI6 and also some rather dodgy banks.

The rumours and implications are legend. Khemlani was subsequently described as a con-man who had been sent via his London company at the bequest of a Hong Kong armaments company with links to the CIA, to sabotage the Australian Government. Allan had no idea. 

CIA

The broker was also reported to be an undischarged bankrupt. Khemlani was last heard of in 1981 when arrested in New York for attempting to sell stolen securities; though he was pardoned for giving up the rest of the criminal gang he’d been working for.

 Khemlani avoided interviews. Always careful in what he revealed, then and when we met, most public statements were provided by Allan as his associate and spokesman. He stated that it was unbelievable Prime Minister Whitlam was not aware of the progress of negotiations over the Arab loan at the heart of the affair.

“Shock and surprise” he said, was the reaction of he and Khemlani over the dismissal of Connor from the ministry. He added that they both felt that Whitlam knew more than he seemed to be admitting.

Khemlani understood Connor had always told Whitlam about the loan negotiations, Allan said. He told them he was reporting everything to the prime minister and Allan couldn’t believe he suddenly did not: “Mr Whitlam is responsible for what his boys do, if anybody should resign it should be the both of them.”

With Khemlani, Allan was joint signatory to 

the 87-page “Khemlani documents” stating their case, presented to the senate in October. He believed the government had a legal obligation to take up the loan but it was now a “dead duck”, while Khemlani was considering his legal position over a claim for commission or expenses. At one stage he had claimed for a commission of $100 million. Neither he nor Crawford made the millions they expected.

Some speculated that Rex Connor may have been a sacrificial lamb for Whitlam and Allan Crawford later said Khemlani, whose nickname was reputed to be “old rice and monkey nuts” because he traded in commodities rather than money, believed that and was sorry.