Showing posts with label corruption. Show all posts
Showing posts with label corruption. Show all posts

Monday 11 March 2024

STATE OF PLAY AUSTRALIA 2024: anti-corruption agencies with runs on the board & the new kid on the block


 With corruption perceived as thriving around the world and Australia showing a worsening corruption level with a 10 point change in the wrong direction since 2012, according to Transparency International, it would be nice to see some improvement on the horizon.


In its 2023 report it seems Australia is not showing any such improvement on CPI results in the previous 2022 report. Although in all fairness, on a global scale the nation is not ranked as a high range offender.


Nevertheless, on the Australian east coast alone, four states and one territory published reports on a combined 73 corruption/integrity investigations in the 18 months between 1 July 2022 and 31 December 2023. [See "BACKGROUND"]


So I'm hoping that the slow progress of the first seven months of the National Anti-Corruption Commission (NACC) only indicates a new anti-corruption agency finding its way and, next year the general public will begin to see at least a hint that some of its 13 current investigations are nearing conclusion. Most especially, I'm hoping that Commissioner Brereton publishes the results of all completed investigations which found corrupt conduct.


Because I can see no good reason why the misdeeds of federal public officials/public servants should be afforded a total secrecy not afforded to their state and local government counterparts or any ordinary citizen.


On 5 March 2024 NACC released its regular weekly update for the reporting period: 1 July 2023 to midnight Sunday, 3 March 2024.


Overview


The National Anti-Corruption Commission:


  • has received 2594 referrals

  • has 376 referrals currently under assessment including 13 under preliminary investigation

  • is conducting 13 corruption investigations

  • is overseeing or monitoring 25 investigations by other agencies


Referral and assessment


At the end of the reporting period, the Commission had:


  • received 2594 referrals

  • excluded 2009 referrals at the triage stage because they did not involve a Commonwealth public official or did not raise a corruption issue

  • 160 referrals awaiting triage

  • 216 triaged referrals under assessment including 13 under preliminary investigation

  • assessed 233 referrals, in respect of which the Commission:

      • decided to take no further action in 213 cases. Typically, this is because the referral does not raise a corruption issue, or there are insufficient prospects of finding corrupt conduct, or the matter is already being adequately investigated by another agency, or a corruption investigation would not add value in the public interest.

      • referred 5 corruption issues to agencies for investigation or consideration.

      • decided to investigate 9 corruption issues itself.

      • decided to investigate 4 corruption issues jointly with another agency.


BACKGROUND


In New South Wales out of the five investigation reports published by Independent Commission Against Corrupt Conduct (NSW ICACC) in 2023, four found seriously corrupt conduct involving members of state parliament, elected local government officials, public authority employees or property developers. While in 2022 four out of five investigation reports published found seriously corrupt conduct involving members of state parliament, political lobbyists, public servants, legal practitioners or land council employees.


In 2022-23 the Queensland Crime and Corruption Commission (CCC) received 3,931 corruption complaints and assessed 3,686 corruption complaints. Finalising 39 corruption investigations, resulting in two criminal charges and seven recommendations for disciplinary action.


In 2022-23 the Victorian Independent Broad-based Anti-corruption Commission (IBAC) began 11 investigations and 18 preliminary inquiries into public sector corruption and police misconduct. It also completed 14 investigations and 12 preliminary inquiries, with 18 investigations and preliminary inquiries still in progress at the end of that financial year.


Also in 2022-23 the ACT Integrity Commission worked on 13 investigations, including two new investigations. It also referred 9 matters:

  • six referrals to the Public Sector Standards Commissioner

  • one referral to ACT Corrective Services

  • one referral to ACT Health

  • one referral to the Justice and Community

    Safety Directorate.


In 2023 the Tasmanian Integrity Commission released two reports on the potential for bias and conflict of interest in local government hiring practices.



Tuesday 3 January 2023

And as Australia enters the first month of 2023.......


It is perhaps well to remember that whilst the cronyism, venality and often industrial scale corruption of national governments is well known in history, here in Australia we appear to hold the quaint notion that as a democracy we will not be led by the likes of a Pahlavi, Marcos or Putin. Men who sought not only authoritarian power but also to enrich themselves from the public purse and their nation’s resources.


But does the example of the former Morrison Government and what is happening in the U.S. right now not make one wonder if we here in Australia need to clearly define limits to the powers held by a prime minister and, perhaps also require all members of any federal Cabinet or outer ministry to present their tax returns to the Parliament for formal audit every year they are in government?


For that matter, perhaps it is well past time that members of a federal government are denied access to taxpayer funds to defray court ordered financial penalties & legal costs in relation to defamation or sexual harassment proceedings.


Both Morrison & Trump ignored democratic principles and processes whenever they chose, with Trump’s action being perhaps the more egregious. However, one has to wonder if profiteering from public office was something both national governments did – if not to the same scale at least with the same frequency.


In Australia we will never know because we have such weak mechanisms to monitor or prevent such things. The Parliament often being reluctant to police members' specific pecuniary interests, the Constitution not shutting the door firmly enough on profiting from the Crown and the Register of Members’ Interests being nothing more than a risible fig leaf covering suspected dodgy trusts and self-managed super funds.


Consider former U.S. president Donald Trump’s financial affairs and ask yourselves: Could some of the prime ministers and/or ministers in office between September 2013 and May 2022 have conducted their own financial affairs in a similar manner?


To call the business structure that Donald John Trump built – carried with him into the White House and back out again - ‘Byzantine’ is being kind.


It appears to be a maze of est. 500 inter-related companies, subsidiaries, partnerships, trusts, overseas bank accounts and possibly shells, potentially designed to literally push financial bullshite uphill until a business income loss or tax credit could be established on paper for personal benefit.


During his first presidential election campaign in 2016 Trump self-reported net wealth of almost US$10 billion with debts of at least US$265 million – thought at the time to be achieved by an exaggeration of property and brand values and that his net wealth would be closer to est. US$4.1 billion. There were calls to show his tax return. He promised to reveal his tax returns but didn’t.


As president he continued to falsely complained that his tax affairs were under almost continuous Internal Revenue Service (IRS) audit so it was impossible for him to release them.


Once the nation voted him out of office Trump went to the U.S. Supreme Court in an attempt to stop the release of his tax returns for the years 2015 through to 2020. A legal battle he lost in TRUMP, DONALD J., ET AL. V. COMM. ON WAYS AND MEANS, ET AL on 22 November 2022.


He was so successful in his resistance up until then that only one incomplete mandatory IRS audit occurred during his presidency - being ordered in September 2019 for the tax year 2016, but never completed and appears to have been quietly abandoned. Trump appointee as IRS Commissioner, Charles P. Rettig, reportedly excused the then president from the mandatory auditing process sometime during his tenure as commissioner.


On 16 June 2021 the U.S. Congress House Committee of Ways and Means wrote to the Treasury Secretary seeking details of the required annual mandatory audits of Trump’s personal tax returns during his presidency, unaware of the true state of affairs.


This letter requested all audit materials from 2015 to 2020 with particular reference to:

whether an IRS examination of the returns took place and the present status of the audits, the applicable statutes of limitations, and the issues considered:

1. The Federal income tax returns of Donald J. Trump (Form 1040),

2. The Federal income tax returns of the Donald J. Trump Revocable Trust,

3. The Federal income tax returns of DJT Holdings LLC (Form 1065),

4. The Federal income tax returns of DJT Holdings Managing Member LLC (Form 1120-S),

5. The Federal income tax returns of DTTM Operations LLC (Form 1065),

6. The Federal income tax returns of DTTM Operations Managing Member Corp (Form 1120-S),

7. The Federal income tax returns of LFB Acquisitions Corp (Form 1120-S),

8. The Federal income tax returns of LFB Acquisition LLC (Form 1065), and

9. The Federal income tax returns of Lamington Farm Club, LLC d/b/a Trump National Golf Club-Bedminster (Form 1120-S).


Trump’s personal tax returns were joint filings with his wife Melania and listed one son as a dependent. He stated his main source of income was derived from Management Services”, Aviation”, “Speaking Engagements”, “Real Estate”, “Golf”, “Ice Skating Rink”, and Restaurant”.


For a man who repeatedly bragged about his business acumen and wealth in the billions, his 2015 personal and business tax returns indicated that he carried forward business loses of US$105.15 million and he and his wife declared a 2015 calendar year joint negative income of $31.7 million leaving a nominal tax bill of $0.


So by 2015 either he was fast approaching the need for yet another strategic corporate bankruptcy or he had applied the most ‘creative’ accountancy when dealing with the U.S. IRS for that year and the following five years.


Either way, once in the Oval Office Trump appears to have continued to follow his own unique tax return template so that by 2020 he was still paying low tax or no tax – apparently due in part to sizeable business income losses at two of the nine entities whose tax returns were requested by the House Committee on Ways and Means  DJT Holdings Managing Member LLC and DTTM Operations LLC. It is interesting to note that 2020 was also a year devoid of charitable donations by Mr. & Ms. Trump and, it seems that there is some suspicion that previous charitable donation figures may be largely unsupported by appropriate documentation.


Page 2 of the House Committee on Ways and Means Final Report spells out some specific accounting concerns:


Charitable contributions—whether the 2015 conservation easement deduction of $21 million and other large donations reported on the Schedule A were supported by required substantiation.

Verification of Net Operating Loss Carryover Schedule—whether the amount of net operating loss carryover in 2015 of $105,157,825 and future years was proper.

Unreimbursed partnership/S corporation expenses—whether the terms of the partnership agreements supported unreimbursed expense deductions totaling $27 million over six years.

Related party loans—whether loans made to the former President’s children are loans or disguised gifts that could trigger gift tax.

Cost of goods sold deductions by DJT Holdings—whether these deductions of about $126.5 million over five years is appropriate when it is not clear what DJT Holdings is selling from the face of the return.

LFB Acquisition LLC—whether there is any support for changes in the management fees and general and administrative expenses of LFB Acquisition that were significantly higher in 2017 ($1.9 million and $2.8 million, respectively) than 2016 ($750,000 and $549,000, respectively) and 2018 ($707,000 and $570,000, respectively).


In fact when it comes to actually paying personal income tax Donald and Melania Trump paid US$641,951 tax in 2015, $US$750 in 2016, $US$750 in 2017, US$999,466 in 2018, US$133,445 in 2019 and US$0 in 2020, claiming a refund of US$5,468,593.


Then there is the matter of the two shell companies set up by Trump’s then personal attorney Michael Cohen in 2016, Resolution Consultants LLC and Essential Consultants LLC. The former allegedly created for the US$120,000 purchase and then suppression of a story by former Playboy Playmate Karen McDougal about her involvement with Trump and the latter created to pay US$130,000 to former adult-film star Stephanie Clifford, professionally known as Stormy Daniels.

A Delaware state judge ordered the dissolution of Essential Consultants LLC and Resolution Consultants LLC in October 2020.


It has been reported that Trump had claimed the second personal expense of $130,000 as a business expense though whether he did that in his 2016 tax returns or later I have been unable to ascertain.


It is noted that, in the three years from 2017 to 2019 Trump donated the annual US$400 million presidential salary “solely for public purposes” in order to get a back a combined total of US$1,200 million as a deduction on his tax bills, according to The Washington Post.


As for an overview of Trump’s business practices…..


To quote Page 5 of the House Committee on Ways and Means’ 20 December 2022 Final Report:


Numerous investigative reports have revealed that the former President, through the complex arrangements of his personal and business finances, has engaged in aggressive tax strategies and decades-long tax avoidance schemes, including taking a questionable $916 million deduction, using a grantor trust to control assets, manipulating tax code provisions pertaining to real estate taxes, and extensively using pass-through entities. Media reports have also revealed that he benefited from massive conservation easements, and that certain of his golf courses failed to properly account for wages paid to employees, raising questions about compliance with payroll and Social Security tax laws. As President, he took pride in “brilliantly” maneuvering the tax laws to his personal benefit. Even as he was championing the Tax Cuts and Jobs Act of 2017, the former President referred to the tax code as “riddled with loopholes” for “special interests—including myself.”


BACKGROUND


The House Committee on Ways and Means “REPORT ON THE INTERNAL REVENUE SERVICE'S MANDATORY AUDIT PROGRAM UNDER THE PRIOR ADMINISTRATION (2017-2020” Final Report of 20 December 2022 can be found at:

https://waysandmeans.house.gov/sites/democrats.waysandmeans.house.gov/files/documents/2022.12.20%20Final%20Report%20House%20Ways%20and%20Means.pdf



On 30 December 2022 the House Committee on Ways and Means released a zip file containing all Donald John Trump’s personal & business tax returns via Attachment E. Links to the full range of documents the Committee has released can be found at the bottom of this document at:

https://waysandmeans.house.gov/media-center/press-releases/ways-and-means-committee-votes-release-investigation-irs-s-mandatory



Friday 20 May 2022

From Sept 2013 to March 2022 the Abbott-Turnbull-Morrison Coalition Government's Political Appointments to Federal Government Agencies were as High as 1 in 3


 

Make no mistake, a returned Morrison Government will take victory as an endorsement of every corrupt and corrupting thing they have done, and they will double down.” [Writer, academic, author Tim Dunlop, Death of a Salesman?” , 19 May 2022]



The Australia Institute, media release, 16 May 2022:


A new report from the Australia Institute’s Democracy & Accountability Program represents the largest and most comprehensive domestic study of the practice of cronyism in relation to appointments to a government agency ever conducted in Australia.


This detailed deep dive report has investigated every single appointment made to the Administrative Appeals Tribunal (AAT) since 1996 – almost 1,000 appointments in total, and reveals that the proportion of political appointments to the AAT has skyrocketed from ~5-6% under the Howard, Rudd and Gillard Governments, to almost one in three appointments (32%) across the Abbott/Turnbull/Morrison Governments, and two in every five appointments (40%) under the current government alone.


Key Findings:


  • The research analyses every single appointment (974 appointments in total) to the Administrative Appeals Tribunal and its precursors between 1996 and 2022.


  • The share of political appointments to the AAT has skyrocketed from 6% under the Howard Government and 5% under the Rudd/Gillard Government to 32% under the Abbott/Turnbull/Morrison term of government.


  • Under John Howard political appointments were 6 in 100, current Government 2 in 5.


  • Under the current Government, the share of political appointments has surged from 23% in 2013–2016 to 40% in 2019–2022.


  • AAT Senior Members who are political appointments are much more likely to have no legal qualifications than Senior Members who are non-political appointments (26% vs 1%).


  • Political appointees were more likely to be appointed on a full-time basis (47% of political appointees) than non-political appointees (22%).


  • Most political appointees had served the party or parties that appointed them.


  • 10% of political appointees had education levels below the level of a bachelor’s degree, compared with 2% of non-political appointees.


  • Since 2016, the current Coalition Government has appointed seven Senior Members without legal qualifications, and all were political appointments.


  • Of the 61 Senior Members appointed by the Coalition Government since 2013, 22 were political appointees.


  • The report makes 10 recommendations for improving the AAT selection process.




Across almost 1,000 appointments to the AAT since 1996, a worrying pattern emerges: appointments have become increasingly political under the current government,” said Ben Oquist, executive director of the Australia Institute.


When John Howard was Prime Minister, only 6% of appointments to the AAT were political, but in the most recent term of the current Government 40% of appointments were political.


These political appointments are much more likely to have no legal qualifications than non-political appointments, even though AAT decisions must consider facts, laws, and policy.


The AAT is responsible for reviewing life-changing decisions by the federal government including deportations, migration visas, NDIS payments, welfare payments, workers’ compensation, and veterans’ entitlements.


Members of the public should be able to trust that their case will be heard by a tribunal member who is qualified and not appointed for political reasons.


A complete overhaul is needed to ensure that the AAT selection process is open and transparent, and not subject to political manipulation. This is now not only important for the AAT but is essential to fix integrity, accountability in government and protect democracy itself.”


Lead author of the report, Deb Wilkinson is an expert in the study of cronyism and is completing her doctorate at the Australian National University.


RELATED RESEARCH

Cronyism in appointments to the AAT

FULL REPORT


Besides political appointments, there are other ways of perverting the function of government agencies and influencing decisions/outcomes.


This was Morrison & Co's response to the Australian National Audit Office fulfilling its legislated brief.


ABC News, 19 February 2021:


The Australian National Audit Office (ANAO) runs the rule over the operations of government department and agencies, checking whether taxpayer funds are being used appropriately.


The profile of the agency has risen considerably in the last year after it uncovered the so-called "sports rorts" saga in early 2020 — revealing the Coalition disproportionately awarded community grants to sports clubs in marginal Liberal and National seats ahead of the 2019 election.


The ANAO also uncovered flaws with the purchase of a plot of land at the site of the new Western Sydney airport, called the "Leppington Triangle".


The Commonwealth paid close to $30 million for a 12-hectare parcel worth just $3 million, with Auditor-General Grant Hehir ultimately referring the land deal to the Australian Federal Police for investigation.….


The October 2020 budget showed a cut of $14 million to the ANAO's yearly funding, something the Auditor-General described as "uncomfortable".


Appearing before a parliamentary committee on Friday, Mr Hehir said his team would have to cut the number of major performance audits it undertook each year to deal with those constraints.


"Historically, for the last two decades, the ANAO has provided the Parliament with an average of 47 performance audit reports per year," he said in his opening statement…...


Monday 25 April 2022

Australian Federal Election 2022: what do political funding rorts look like and are they part of a corrupt process?


Looking at past Liberal Party of Australia political rorts may help to assess Scott Morrison's current election campaign promises which have a dollar amount attached when first announced and/or a specific electorate is included in the announcement.


So what has all the Liberal Party's much touted "individual freedom and free enterprise" delivered since 2013?


Well between 2013 and 2018 it appears to have delivered federal regional grants totally $714,563,851. With 57.62% of this funding directed to 77 Coalition-held electorates and, the remaining 26.92% going to 74 other electorates - 68 ALP & 6 minor party/independent.


Some electorates such as Hinkler (Qld) held by Nats-LNP since 1993 received well in excess of $26 million in regional grants. Mallee (Vic) held by Nats since 1972 and Capricornia (Qld) held by LNP since 2013 received over $24 million each. While Dawson (Qld) held by LNP since 2010 received over $31 million - and on it went over the approximately six year span.


Has this brazenly partisan allocation of Treasury funds lessened under the prime ministership of the Liberal MP for Cook?


Apparently not, because the bulk of the billions listed in the next paragraph were distributed on Morrison's watch.


According to The Sydney Morning Herald on 16 April 2022, taxpayers have funded $55.6 billion in federal government grants over less than 4 years (including a hefty $20 billion last year) under rules that give ministers sweeping powers to decide payments, often without any criteria or reporting & against departmental advice. From January to March this year another $1 billion was distributed as grants.


So where might some of those $55.6 billion dollars have found a home?


Nor being a forensic accountant I am not up to the task of tracking that down, but there are some clues to be found.


Take the joint Federal-States Black Summer Bushfire Recovery Grants Program.



The “Black Summer” bushfire season actually ran from July 2019 through to early March 2020 and during this period est. 2.9 million adult Australians had their property damaged, their property threatened, or had to be evacuated, often along with their families.


This Black Summer Bushfire Recovery Grants Program funding pool held $390,893,779 – with $296,746,274 allocated and $94,147,508 still unspent in February 2021.


Over 100 local government areas in Queensland, New South Wales and Victoria were listed in the grant eligibility criteria.


A total of 57.63% of all grant allocations worth est. $171,035,576 went to Coalition electorates, 31.33% worth $92,994,495 to Labor electorates and, 11.02% worth $32,716,230 to Independent/minor party electorates.


In December 2020 it was revealed that one of Australia's richest men who happens to be a Liberal Party donor had received $10 million in bushfire recovery funding - to expand a paper mill not directly affected by fire.


In February 2022 the Morrison Government announced that the Black Summer Bushfire Recovery Fund had received an additional $110 million for 524 "broad recovery projects" with unspecified recipients. The this grants program is now listed as closed.



Just in case a reader might think that the nature of that 2019-2020 mega bushfire season might have skewed funding allocations, here is another example which clearly indicates bias.


Round 5 of the Building Better Regions Fund – Infrastructure Projects Stream.



There it is in glorious colour.


A total of 73. 23% of this grant round, worth est. $215,281,617 going to Coalition electorates and 26.76% worth est. $78,678,728 going to electorates held by Labor and the cross benches. Liberal & LNP MPs receiving the bulk of this largesse held federal seats in New South Wales and Queensland.


Then there is the National Commuter Car Park Fund.


The Urban Congestion Fund (UCF) was established in the 2018–19 Budget. Total funding for the UCF had grown from $1 billion to $4.8 billion as at 31 March 2021.The National Commuter Car Park Fund is a component of the UCF.


This is what commuter car park funding allocation looked like in February 2021.



A total of 77 Liberal Party electorates received a whopping 81.75% of the total funding pool worth $575,890,000. Among the Liberal Party luminaries lining up for the prime minister’s largesse were; Josh Frydenberg (Kooyong Vic), Alan Tudge (Aston Vic), Tim Wilson (Goldstein Vic), Michael Sukkar (Deakin Vic), Jason Wood (La Trobe Vic), Angus Taylor (Hume NSW), David Colman (Banks NSW), Stuart Robert (Fadden Qld), Bert Van Manen (Forde Qld) Peter Dutton (Dickson Qld) and Andrew Hastie (Canning WA).


In June 2021 the Australian Auditor-General handed down a performance report titled Administration of Commuter Car Park Projects within the Urban Congestion Fund.


The performance report found numerous inadequacies, including:


  • at 31 March 2021, there had been 44 commuter car park projects announced involving upgrades at 47 identified sites with a total Australian Government funding commitment of $660.4 million;


  • assessment work had been completed for 10 car parks resulting in $100 million of Australian Government funding being approved for the full project (including delivery of construction work). Construction had been completed at two sites and had commenced at a further three sites;


  • The Department of Infrastructure’s administration of the commuter car park projects within the Urban Congestion Fund was not effective;


  • The department’s approach to identifying and selecting commuter car park projects for funding commitment was not appropriate. It was not designed to be open or transparent. The department did not engage with state governments and councils, which increased the risk that selected projects would not deliver the desired outcomes at the expected cost to the Australian Government. Departmental advice did not contain an assessment against the investment principles or policy objectives and it was not demonstrated that projects were selected on merit. The distribution of projects selected reflected the geographic and political profile of those given the opportunity by the government to identify candidates for funding consideration; and


  • The selection of 47 commuter car park sites for funding commitment were decisions of government taken over the period January to July 2019 and:


      • effected in 38 cases (81 per cent) by the written agreement of the Prime Minister to a written request from Ministers;


      • effected in seven cases (15 per cent) by the election commitment process; and


      • in two cases (four per cent) the department had not evidenced how the funding commitment was effected, beyond email advice from the Minister’s Office and a media announcement by the Prime Minister. [my yellow highlighting]


By 2022 it was apparent that most of 47 commuter car parks which had funding allocated were no longer considered active proposals and at least 5 proposed car parks appear to have been scrubbed from the original list – 4 in Labor electorates and one in a Liberal Party electorate.


Lack of transparency, across the board poor record keeping, no apparent accountability for decisions made and politically partisan use of public money - are all indicators of corrupt processes in this particular grant fund. 


This next chart demonstrates funding allocations for sports infrastructure.





A breakdown of full details can be found at:

https://www.thevogfiles.com/uploads/1/3/5/1/135189168/copy_of_sporting_grants5_1.xlsx


To say that voters are not happy with the Liberal Party is an understatement. This was one voter in the Australian Capital Territory......


Firstly, the biggest misdirect, perhaps lie, perpetrated by the Liberals is that they are a Federal Political Party - a single administrative & policy unit like the ALP. They are a bunch of independent Fiefdoms, ruled in what looks like a Feudal system with a truly byzantine organisation…..

I’ve looked at the Liberal Federal Secretariat & "Liberal Party NSW" sites and they don’t publish any “Values”,

They publish some very rubbery & loose “Beliefs”. Untestable, and unaccountable motherhood statements. Summarised at the end as:

In short, we believe in individual freedom and free enterprise"

Tony Abbott around 2013 clearly annunciated both Liberal Party Values & Purpose: “We are not Labor”.

Nobody in their right mind would invest in a company with the absence of proper Governance & Accountability embodied in the many “Liberal” party Fiefdoms in Australia, nor would they tolerate the absence of consistent Values, Priorities and Policies.” [Voter from Kippax, ACT, 3 March 2022]



SOURCES

The VOG Files, Rorts Central at:

Australian National Audit Office (ANAO) at:

Parliament  of Australia, Members at: