The alleged incident happened at the championships, which double as an Olympic qualifying competition.
Audio: Listen to Ben Knight's report (AM)
Australia needed a high finish as a team in the event to win a quota spot for one weightlifter to compete in London.
"We were a little bit bothered about one of the attitudes of one of the athletes who, we felt, wasn't going to reach his potential within the total and so in order to give him a little bit of an incentive, I personally offered him an amount of money," Keelan said.
"In fact the amount was $1,000, to make sure he did a total that would place him as high as possible in the event so that we could score the maximum points in order to make sure that our team did exactly what we set out to do, which was to qualify one athlete in the male section."
"You think that everyone who's representing Australia does so with pride and with commitment and, unfortunately, we heard that that wasn't the case with Daniel Koum," he said.
"So I personally thought, well, the best way to negate any negatives out of all this would be to, by offering, sort of, some money, whereby he could actually compete and have some incentive to do the total that we asked of him which was 250 kilograms."
Keelan said that Koum originally agreed to the $1000 payment, shaking hands with the chief executive in front of witnesses.