The department had originally been made aware the land could have been purchased in January, 2011.
By January 2013, the Ottones had received close to $1.3 million in payments from the department before the completion of the housing project in 2014.
CCC acting commissioner Scott Ellis, in an opening statement, told the hearing at the very best the department had missed out on an opportunity to buy some cheap land.
“At worst, there was corrupt diversion of funds for housing to underwrite Mr Whyte’s gambling,” he said.
Mr Michell, who says he was involved in the buying and selling of several blocks of land in the Pilbara during the mining boom, provided inconsistent evidence to the hearing around the timing of events involving the block that was used for police housing.
He told the hearing he became aware of the Roebourne land, where the police accommodation would go, through jailed former public servant Craig Dale.
Mr Michell said it was possible he had provided cash to Mr Dale for spotting the land.
The bookie said he could not get the finance to buy the Hampton Street lots and contacted his friend, Mr Ottone, who purchased the land.
Mr Michell said he got in touch with Mr Whyte, who would eventually sign the contract on behalf of the department to buy the land, to ask him if he could do anything with the property.
“He came back and said, ‘We’re going to buy the land’,” Mr Michell said.
Mr Michell told the hearing how Mr Whyte said the government would get a builder and the landowners would receive 10 or 12 per cent of building costs.
According to Mr Michell, Mr Whyte would use him to place bets in the bookie’s name, with debts sometimes reaching as much as $800,000.
Mr Michell said none of the money from the deal was offset against any debts Mr Whyte might have had, and the official had not benefited from the land transaction by a single dollar.
He told the hearing he himself may have received as much as $400,000 from the deal but it was just a guess.
Mr Michell frequently mentioned during the hearing he was not in a good head space at the time.
“The worst thing I did was, now I look back, the worst thing I did was get involved putting bets on for Mr Whyte,” he said.
The bookie made three payments worth $8709 towards mortgage payments for the Hampton Street land between June and September in 2011, according to a bank statement tabled in the hearing.
Counsel assisting the CCC, Tse Chee Loo, said in her opening address the curtain would be raised in the next three days on what happened behind the scenes with the sage of the Roebourne police housing complex.
“There was more to the story than what had first appeared to be a standard land acquisition by
a government department to build government housing,” she said.
“Was the land purchased solely for the benefit of the Roebourne community or was it purchased
at a hugely inflated price for the benefit of Mr Whyte’s gambling associates?
“In the years in which the department bought the Hampton Street lots and developed the police
housing complex, the commission’s investigation has uncovered hundreds of thousands of
dollars moving between bank accounts controlled by Mr Whyte, Mr Michell and Mr Ottone.
“The movement of these massive sums of money between Mr Whyte, Mr Michell and Mr Ottone,
at the time when Mr Whyte acted on behalf of the Department of Housing in purchasing land
from Mr Ottone, raises serious questions, which the commission will explore during these
Ms Loo said the examinations during the week would also take a broad look at the culture of the department at the time.
“The commission will explore whether a desire to cut red tape and bureaucracy, together with a
reluctance to report suspected misconduct, may allow corruption to flourish because proper
procedures and safeguards are disregarded,” she said.
The hearings continue on Tuesday with Mr Ottone fronting the CCC.
Peter de Kruijff is a journalist with WAtoday.