THE Independent Commission Against Corruption (ICAC) has launched a public inquiry into sensational allegations surrounding former UNE chancellor John Cassidy.
Mr Cassidy was chancellor from 2004 to 2008 but failed to have his contract renewed after UNE staff passed a motion of no confidence in him.
The 69-year-old Uralla multi-millionaire is accused of passing on sensitive information, acquired in his capacity as chancellor, to business partner Darrell Hendry relating to the sale of the Services UNE-owned Tattersalls Hotel.
ICAC is also investigating whether Mr Cassidy failed to disclose to UNE that Mr Hendry was planning to lodge a tender for the hotel in November 2005.
He will also be asked to answer questions surrounding a letter he sent to the chair of UNE Council's Audit and Compliance Committee in February 2006, where he admitted he may have a conflict of interest in the hotel sale.
Mr Cassidy chaired the meeting where his own letter was tabled, ICAC will allege.
In 2007, Mr Cassidy nominated former Northern Tablelands MP Richard Torbay for an honorary doctorate from UNE.
The Tattersalls Hotel had been acquired on the university's behalf for $900,000 in 1995 earlier by Mr Torbay, who had risen from the ranks of kitchen hand to run the UNE Union.
But the iconic art deco hotel with its 42 bedrooms was not the money-spinner that the union had hoped and in 2005 the union was put into administration with instructions to sell the hotel.
The day after Mr Torbay was appointed to the university council, on September 29, 2005, the council resolved to take over all the assets and liabilities of the troubled UNE Union. A new entity, Services UNE, was established.
It was initially recommended that the administrator Stephen Hall, from local accountancy firm Forsyths, organise an auction for the hotel, but it was later decided to sell by tender. The successful tenderer was Mr Hendry's company Armpub No.1.
Although the deal had not been finalised, Mr Hendry was quoted in The Armidale Express in mid-December 2005 about his purchase and that he would welcome a partner in the hotel business.
Corporate records show on January 30, 2006 - three days before the pub sale was finalised - Mr Cassidy joined Mr Hendry as a director of Armpub, the company which bought the hotel.
Some weeks later rumours began to surface that Mr Cassidy had joined Mr Hendry as an owner of the Tattersalls in Beardy Street.
Under the headline ''Cassidy slams hotel rumour'', the chancellor told the Express of his outrage at the suggestion he had inside knowledge on the sale.
He claimed he only discovered his Sydney-based friend Mr Hendry had purchased the hotel when he read it in the Express back in December.
Mr Cassidy denied having any knowledge of the tender process, the article suggested.
However, the Sydney Morning Herald last year revealed that Mr Hall, the administrator, worked with a select group including Mr Cassidy on the recommendation to dispose of the hotel.
The ICAC public inquiry will be held on July 21 in Sydney.