A businessman accused of selling Australian defence and security secrets to foreign spies worked with public source documents and has cooperated with ASIO and police, his lawyer told a Sydney court.
Alexander Csergo has been in custody since he was arrested at his Bondi home on Friday and made an application for bail, which was denied, in Downing Centre Local Court today.
Australian Federal Police (AFP) allege an individual claiming to be from a think tank contacted the 55-year-old while he was overseas, and arranged for him to meet with two representatives.
It's alleged two people known to Mr Csergo as "Ken" and "Evelyn" offered payment for information about Australian defence, economic and national security arrangements, as well as matters relating to other countries.
He allegedly compiled reports from this information, and accepted the money.
Solicitor Conor McCraith, for the Commonwealth Director of Public Prosecutions, revealed Mr Csergo first became involved with "Ken" and "Evelyn" in early 2021, and said by his own admission, he "immediately suspected" the pair worked for Chinese intelligence.
However, he remained in contact with them for two years, Mr McCraith said, during which time thousands of messages and multiple reports were exchanged.
Mr McCraith said Mr Csergo also returned to Australia with a "shopping list" of matters pertaining to Australia's national security interests, and the defendant failed to notify authorities, as a reasonable person would have.
The court was told he also invited "Ken" back to Australia.
"In other words, he invited someone he believed to be a spy to come to Australia," Mr McCraith said.
Businesspeople know 'it's an authoritarian state': lawyer
Defence barrister Bernard Collaery told the court the various documents which his client used were "largely from open-source documents".
He said both ASIO and the AFP had "gone right through his laptop" and WeChat messages, and confirmed all the work was from publicly available material.
Mr Collaery said Mr Csergo was an experienced, successful businessman, and understood how business was done in China.
However, he said the statement of alleged police facts attempted to suggest there was "something sinister" about "Ken" and "Evelyn".
"The fact is, as Australian businesspersons know, it's an authoritarian state," Mr Collaery said during the bail application.
"All roads lead to the state. If someone walks up to you in a bar, you're wary. Businessmen are."
Magistrate Michael Barko said there was no issue about Mr Csergo being an ignorant traveller or wanting to make a "quick buck".
The magistrate said he was able to infer Mr Csergo must have been "on the radar" of intelligence authorities in Australia for some time.
Despite saying he was unaware of how things operated in China, Magistrate Barko said the alleged facts effectively encapsulated a very strong prosecution case.
"In this country if I read those facts, to any lay person, they would be highly suspicious about the conduct of the defendant, at the very least."
Use of 'publicly available source material'
Defence barrister Mr Collaery said while his client had been encouraged — even lauded — for developing work with the Chinese, at the same time the federal government had developed foreign interference laws, which raised questions about how a person can do business in China.
"How do you provide them with publicly available source material, and not be seen to be doing something sinister?" he said.
Mr Collaery took issue with the AFP publishing a media release with footage of the arrest, which mentioned espionage, despite his client not having been charged with that offence.
"It's the police coming to this state with the drums that are beating in Canberra," Mr Collaery said.
The court heard Mr Csergo returned to Australia after a lengthy COVID lockdown in Shanghai, and wishes to go back when it is safe.
His barrister also raised concerns about his client being kept in solitary confinement with lights on "day and night", after he was classified as a high-security risk prisoner.
Mr Csergo was denied bail and slumped back in his chair as he learned of the decision via video link.
The case returns to court in mid-June.
