NSW Labor boss 'compromised' party

Dominica SandaAAP
Suspended NSW Labor boss Kaila Murnain has been accused of lying about a meeting with a party lawyer
Camera IconSuspended NSW Labor boss Kaila Murnain has been accused of lying about a meeting with a party lawyer

Suspended NSW Labor boss Kaila Murnain has admitted her failure to come forward about a potentially illegal donation compromised the party she said she loves as much as her family.

Ms Murnain on Friday continued her evidence to the Independent Commission Against Corruption which is examining whether Chinese billionaire Huang Xiangmo was the true source of $100,000 said to be donated to Labor by 12 people from a 2015 fundraising dinner.

Mr Huang, a property developer, was prohibited by law from making donations to NSW political parties.

Ms Murnain was last week suspended from her role as the party's general secretary after telling the inquiry she knew about a potentially illegal donation for nearly three years.

She broke down as she told the inquiry on Friday how much the ALP - which she tried to join when she was 12 - meant to her.

"It was everything," she told ICAC.

"It was literally the only thing that mattered to me other than my family."

The inquiry heard Ms Murnain joined the party when she was 13 or 14 after she had "harassed" them to join earlier.

Labor lawyer Arthur Moses SC asked Ms Murnain whether her actions compromised the party because it opened the ALP up to suggestions it engaged in acts of illegality.

Ms Murnain tearfully responded "Yes".

She admitted that by not revealing her knowledge of the donation she cast an unfair shadow over the party and its members.

In her earlier evidence, Ms Murnain said former Labor senator Sam Dastyari told her to seek legal advice after she learnt about the potential illegal donation made to the ALP.

She told the inquiry that Labor lawyer Ian Robertson advised her to "forget the conversation happened" and that she wouldn't be billed for their September 2016 meeting.

But Mr Robertson's lawyer, Tony McInerney SC, on Friday accused Ms Murnain of lying about the nature of the meeting.

Mr McInerney suggested that the September 16 meeting with the lawyer was pre-arranged and related to a different matter - whether a company had paid for former Labor MP Nick Lalich to travel to China.

"The true position is staring you in the face," Mr McInerney said.

"You arranged a meeting with Mr Robertson before you spoke to Mr Dastyari."

Ms Murnain insisted that was not her recollection.

Mr McInerney accused Ms Murnain of giving evidence that was a "pack of lies" to which she responded "No".

The inquiry was shown an invoice of Mr Robertson's fees for the services given to Labor during September 2016.

The invoice shows that on September 16 Mr Robertson billed the party for telephone discussions and a meeting with Ms Murnain relating to political donations.

Mr McInerney suggested the meeting was about the issue involving Mr Lalich but Ms Murnain insisted that wasn't the case.

"You came unstuck didn't you on your version of events when you added that Mr Robertson wouldn't be billing you," Mr McInerney said.

Ms Murnain insisted: "No, I did not".

Mr McInerney then accused Ms Murnain of "completely fabricating" her evidence and asked her if she was billed for the meeting.

"You would have to ask Mr Robertson," Ms Murnain said.

Mr Robertson is expected to give evidence to the inquiry on Monday.

Get the latest news from in your inbox.

Sign up for our emails