PNG's O'Neill sacks corruption watchdog

PNG PM Peter O'Neill has sacked his attorney-general as a court battle over an arrest warrant looms. Source: AAP

PAPUA New Guinea Prime Minister Peter O'Neill has sacked the deputy police commissioner and shut down a corruption watchdog that was trying to arrest him over an alleged multi-million dollar fraud.

A POLICE warrant was issued for Mr O'Neill's arrest on Monday over allegations he siphoned $31 million of public funds to law firm, Paul Paraka lawyers.

Mr O'Neill denies any wrongdoing and on Wednesday shut corruption watchdog Task Force Sweep - effectively ending its investigation into the matter.The prime minister accused Task Force Sweep, which is made up of Justice Department staff and police, of colluding with unnamed politicians.Taskforce boss Sam Koim said shutting his organisation was the "gravest mistake".Mr O'Neill also sacked Police Chief of Operations Deputy Commissioner Simon Kauba, who was heavily involved in the case, accusing him of disobeying government orders.In a further development, new police commissioner Geoffrey Vaki was arrested in an apparent response by police to Mr Kauba's dismissal.He was reportedly being questioned by fraud squad officers.The upheaval, which may spark protests, came after a court case launched by Mr O'Neill's lawyers to stay the warrant for his arrest was adjourned until next week.The key evidence in the case against Mr O'Neill - which has gripped PNG for months - is a letter he allegedly signed authorising $31 million be paid to Paul Paraka lawyers.The prime minister has dismissed the note as a fake.Mr Koim revealed on Tuesday that Sydney-based private investigators believe the document is genuine."We have now received the forensic examination report from the Sydney-based Forensic Document Services Pty Ltd confirming that the signature on the letter ... directing payments to Paraka Lawyers is PM O'Neill's," Mr Koim said.Mr O'Neill on Tuesday announced a commission of inquiry into the allegations against him, led by Australian judge Warwick Andrew.The Paul Paraka affair - called Parakagate in Port Moresby - is one of PNG's longest-running fraud investigations.Mr Paraka, one of the most powerful lawyers in PNG, was arrested and charged in 2013 for allegedly receiving the state monies.Task Force Sweep had alleged the payments were spread over a seven-year period and ran into the "hundreds of millions".

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