Nine people have been charged with fraud-related offences over alleged serious corruption in the transport sector by Victoria’s Independent Broad-based Anti-corruption Commission.
IBAC has confirmed for The Mandarin that two former Department of Transport employees were among those charged, but could not confirm the names until the matter appears before the court. AAP has named the pair as Hoe Ghee (Albert) Ooi and Barry John Wells.
In October 2014 IBAC recommended charges be brought against Ooi and Wells, who allegedly obtained over $3 million in monetary profits and other benefits after around $25 million was paid by Department of Transport and Public Transport Victoria to entities that were controlled either by Wells and Ooi between late 2006 and 2013.
Public Transport Victoria is a statutory authority in the transport portfolio, which formerly sat in the Department of Transport, now the Department of Economic Development, Jobs, Transport and Resources.
The report into the investigation of Ooi and Wells, known as Operation Fitzroy, has been taken off the IBAC website while the matter is before the courts.
More than 100 charges have been laid against nine individuals and one company, with alleged offences including:
- conspiracy to cheat and defraud,
- obtaining financial advantage by deception,
- misconduct in public office,
- giving and receiving secret commissions, and
- furnishing false information.
The Operation Fitzroy report found that Ooi and Wells had “corruptly awarded contracts and pocketed public money which was allocated for public infrastructure. As a result, some public projects were not completed or were completed to an unsatisfactory standard. In some cases, invoicing was inflated and the excess cash went to those involved.”
Their conduct went undetected for at least seven years at DOT/PTV and continued until overt action was taken by IBAC in late 2013.
At the time the report was tabled in October 2014, commissioner Stephen O’Bryan QC stated:
“DOT and PTV’s culture relating to, and methods of dealing with, possible corrupt conduct were plainly inadequate during much, if not all, of the relevant period.
“ … Public sector agencies like PTV spend billions of taxpayer dollars on vital goods and services for the community. Responsibility for public expenditure comes with an obligation to have robust measures in place to ensure integrity in procurement practices.
“Without robust measures, systems are left vulnerable to corruption by individuals — at great cost to our state and our community.
“Sadly, the issues identified by Operation Fitzroy are not isolated — a number of our current investigations are looking at similar issues. This highlights a clear need for the Victorian public sector to learn from the findings of IBAC’s Operation Fitzroy in order to prevent corruption.”
The corruption identified in Operation Fitzroy “occurred largely because of poor controls, an organisational culture of non-compliance, and inadequate supervision in DOT and PTV,” said the report.
Evidence provided during the course of Operation Fitzroy revealed the following deficiencies:
- DOT and PTV favoured timely outcomes above compliance with procurement process
- the procurement team was inadequately resourced
- procurement policy was generally not supported by management
- management lacked accountability and deficiencies in procurement processes were highlighted to senior management as at 30 April 2012
- staff members were not properly, or at all, trained for risk identification associated with fraud and corruption
- the structure within the divisions at DOT and PTV precluded visibility of non-compliance with procurement processes across Mr Wells’ division (and others) so that corrupt conduct could be contained and covered up
- the application of CMS was not mandatory. PTV has indicated that confusing and overlapping procurement policies have since been streamlined.
PTV CEO Mark Wild made a commitment when he gave evidence “to fully implement a comprehensive program of procurement reform and cultural change to address the serious issues identified”, notes the report.
It also stated that “to support broader learning and practice improvement across the public sector”, the issues raised by Operation Fitzroy will also be referred by IBAC to:
- the Department of Treasury and Finance and the VGPB [Victorian Government Purchasing Board], as the lead agencies responsible for ensuring best practice in public sector procurement, and providing associated advice and training to government employees
- the Victorian Public Sector Commission for consideration in the context of its stewardship of policy frameworks and supporting tools for the appropriate management of conflicts of interest, gifts and benefits, and secondary employment arrangements.
Those charged have been summoned to appear in the Melbourne Magistrates’ Court on 6 July.