Former Victorian education official goes to prison for conspiracy to defraud

By Melissa Coade

Monday July 19, 2021

Nino Napoli (right) is seen leaving a directions hearing at the Victorian County Court
Nino Napoli (right) is seen leaving a directions hearing at the Victorian County Court. (AAP Image/Ellen Smith)

Career bureaucrat Nino Napoli will be eligible for parole in one year and 11 months, after entering a deal with prosecutors admitting that he used taxpayer money to buy electronics, wine, and for the maintenance of his toupee.

Napoli was a senior Victorian public servant with the department of education and training, having worked with the department for 40 years. In his role as the department’s finance unit general manager, he was responsible for a $5 billion budget.

Between 2007 and 2014 Napoli orchestrated a scheme known as the ‘banker school’ scheme, where he approved contracts to companies that were run by his family members. As part of the rort, he told relatives to create invoices that described work for schools, some of which was never carried out. 

Napoli, 65, and his 63-year-old cousin Carlo Squillacioti entered guilty please to charges of conspiracy to defraud and conspiring to pervert the course of justice last year. 

Squillacioti, a motor mechanic by trade and director of printing and IT companies that were awarded dodgy contracts by Napoli, was sentenced to two years and five months in prison. Squillacioti must serve 15 months before he is eligible to apply for parole. 

The Age reports that on Wednesday County Court Judge George Georgiou sentenced the pair for their part in devising a scheme to award contracts, which appeared to be legitimate, but only benefited themselves. 

Judge Georgiou said the men’s crimes were sufficiently serious to warrant imprisonment, despite defence lawyers for the pair arguing that they should serve community correction orders based on their admissions of guilt and good future prospects. Both men apologised for their offending.

“The course of conduct was designed to hide the fact that departmental work was being conducted by your relatives, Mr Napoli, and that both of you were receiving financial benefits because of that work,” the judge said. 

“You both corrupted the procurement processes designed ultimately to protect the revenue,” the judge said. “You undermined the trust that citizens of this state place in public servants to expend taxpayer funds honestly.”

In their respective plea deals, Napoli conceded to personally pocketing $95,000 of department money and Squillacioti $58,000. The men told the court that they were ashamed, embarrassed and remorseful.

Judge Georgiou however characterised the men’s conduct as sophisticated and well planned, designed to deny honest suppliers that chance to win government tenders. 

“You both corrupted the procurement processes designed ultimately to protect the revenue,” the judge said. 

“You undermined the trust that citizens of this state place in public servants to expend taxpayer funds honestly.”

The judge added that Naopli’s conduct in particular was an ‘egregious breach of trust’ from a senior department figure. Napoli was sentenced to three years and 10 months for dealing with 72 dodgy invoices.

A 2016 probe by the Independent Broad-Based Anti-Corruption Commission (IBAC) accused Naopli of mishandling over $6 million of department money and alleged he actually benefited with $1.9 million as the architect of the grants rort. 

Under the banker school scheme, which was designed for nearby schools to share grant money, Napoli was accused of falsifying invoices and contracts to the tune of $500,000. He then used department money to pay these dodgy invoices to his relatives directly or with banker school money grants. 

When IBAC investigators began to circle, Napoli organised his contacts to try and prevent the anti-corruption team from getting to the bottom of the truth by rehearsing their responses for any public hearing called to examine their conduct. He instructed family members to destroy a spreadsheet that included details of suspicious payments, and was recorded coaching a former school principal about what to say to investigators.

IBAC’s investigation into allegations that false and inflated invoicing was being used within the education department, as well as claims that senior officials had organised payment of inappropriate expenses including excessive hospitality, travel and personal items, was known as Operation Ord.

A statement issued by the corruption watchdog on Monday said that Nino’s brother Robert Napoli had recently entered a guilty plea to one charge of conspiracy to defraud as part of the IBAC investigation. His plea hearing is listed for 6 September, 2021.

Nino Napoli resigned from his job at the department in 2015 and has repaid the $95,000 he admitted to defrauding. 

The Victorian state government has indicated that it will pursue the disgraced ex-public servant for up to $6 million in damages that it alleges Napoli misappropriated.


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