Laurie Connell - Rothwells

Rothwells

During the 1980s, Connell started acquiring numerous local businesses through aggressive takeovers before setting himself up as a deposit taker for investors under the name of Rothwells Merchant Bank, which had begun its life as a Brisbane-based menswear chain. Immediately after the 1987 stock market crash, there was a run on the bank from local investors. Connell put together a rescue package involving numerous Australian businessmen and approached the premier, Brian Burke, who provided a A$150 million government guarantee to provide short-term relief. Despite this, after Burke's resignation on 25 February 1988, incoming premier Peter Dowding was required to enter very complicated and controversial dealings in an attempt to protect the government's interests. Rothwells ultimately went into liquidation, causing heavy losses to the government and Rothwells investors.A royal commission later found that:

Mr Dowding, as premier, presided over a disastrous series of decisions designed to support Rothwells when it was or should have been clear to him and to those ministers closely involved that Rothwells was no longer a viable financial institution. This culminated in the decision to involve the Government, through WAGH, in the Kwinana petrochemical project as a means of removing the Government's contingent liability for certain of the debts of Rothwells. Electoral advantage was preferred to the public interest.

The political fallout from the collapse as well as other government dealings in the period dominated media and political discourse in Western Australia during 1990, and premier Carmen Lawrence ultimately called the royal commission in November 1990 to investigate. The enquiry became known as the WA Inc royal commission and resulted in the jailing of Connell, Burke and a number of other involved parties.