NSW police minister acted corruptly: ICAC

NSW Police Minister Mike Gallacher and former cabinet member Chris Hartcher hatched a plan to corruptly disguise banned political donations to the NSW Liberal Party, the state's corruption watchdog has heard.

Darren Williams, a senior executive at coal mogul Nathan Tinkler's development firm Buildev, told the Independent Commission Against Corruption (ICAC) on Friday that he lobbied both men over a lucrative coal terminal in Newcastle.

"It could have been a fortune in the pocket of Mr Tinkler, couldn't it?" counsel assisting Geoffrey Watson asked.

"Yes," the witness replied.

But in a sensational morning of evidence, Mr Williams firmly denied putting together a plan with Mr Gallacher, Mr Hartcher and former Hartcher staffer Tim Koelma to funnel banned donations to the Liberal Party via Mr Tinkler's stud farm Patinack.

The $66,000 in donations then went through Mr Koelma's slush fund, EightByFive, Mr Watson said.

It is alleged Mr Hartcher helped "work up" the crooked scheme but that Mr Gallacher was central to the plan.

He was the man who introduced Mr Williams, his longtime friend, to Mr Koelma, Mr Watson said.

"It was through him that the two of you hatched a corrupt scheme to make donations to the Liberal Party using the EightByFive business," Mr Watson said.

"No," the witness replied.

"I can tell you by the end of this day you're going to regret giving that answer Mr Williams," Mr Watson said.

Counsel assisting warned the witness multiple times that the ICAC watchdog did "not go off half-cocked" and had hard evidence to show the allegations were true.

NSW electoral funding laws have blocked property developers from making political donations since 2009.

Mr Hartcher, as well as fellow MPs Chris Spence and Darren Webber, were sidelined from the Liberal Party in February following allegations from the current ICAC inquiry, Operation Spicer.

Their colleague Marie Ficarra was also moved to the crossbenches, earlier this week, following fresh evidence presented by the corruption watchdog.

The latest controversy at ICAC comes only weeks after the shock resignation of then premier Barry O'Farrell over an unregistered $3000 bottle of wine.

Mr Gallacher, whose is from the Central Coast, served 16 years in the police force before becoming an upper house MP in the NSW parliament in 1996.

He is 52-years-old and has two children.