The NSW Independent Commission Against Corruption (ICAC) has found that employees of companies who supplied security services to the University of Sydney engaged in serious corrupt conduct through dishonestly obtaining many hundreds of thousands of dollars in funds via submitting false timesheets.
The CEO of one company and an employee of the other company also engaged in serious corrupt conduct by providing benefits to the University’s security operations manager, including a pinball machine and luxury hotel accommodation, as an inducement or reward for him using his position at the University to favour their interests. The manager also engaged in serious corrupt conduct for accepting, or agreeing to accept, the gifts as an inducement or reward for favouring those interests.
In a report released today, Investigation into the over-payment of public funds by the University of Sydney for security services (Operation Gerda), the Commission finds that between December 2015 and April 2018, employees of Sydney Night Patrol and Inquiry Co Pty Ltd (SNP) and its subcontractor, S International Group Pty Ltd (SIG), obtained financial benefits by submitting timesheets in which they made false representations as to the identities of guards who provided, or purported to provide, ad hoc security services to the University, knowing that the funds to pay those claims would ultimately come from the University.
This practice, known as “ghosting”, involves the unauthorised use of the name and security licence details of a security guard who is not working a shift to secure a financial benefit. The Commission finds that SNP employees Emir Balicevac, Daryl McCreadie, and Frank Lu engaged in serious corrupt conduct through this practice, which respectively netted them about $222,905, $27,283 and $244,091. The ICAC finds that SIG security guard George Boutros also engaged in serious corrupt conduct by engaging in the same practice between October 2016 and April 2018. However, as an SIG employee, it is difficult to differentiate between the rostered shifts he legitimately claimed, and the ghosting shifts he illegitimately claimed, so the precise amount he dishonestly claimed is unknown.
The Commission finds that SIG director and CEO Taher Sirour engaged in serious corrupt conduct through facilitating payments to Mr Balicevac, Mr McCreadie, Mr Lu and Mr Boutros on the basis of the false timesheets to obtain a financial advantage from SNP at the cost of the University. He was aware that Mr Balicevac and Mr Lu were falsely claiming payments for ad hoc services that had not been provided.
Mr Sirour further engaged in corrupt conduct by providing payment for accommodation in October 2015 at the Shangri-La Hotel Sydney, a meal at Wolfies restaurant, and a car and driver to and from the hotel to Dennis Smith, the University’s security operations manager, and his wife for their 30th wedding anniversary. This conduct, and payment for a further stay at the hotel in 2017 that was ultimately cancelled, and proposed tickets for an overseas trip in April 2018, were provided as an inducement or reward for Mr Smith to use his position at the University to favour, or influence him to favour, the interests of SIG and Mr Sirour.
Mr Balicevac also engaged in serious corrupt conduct by providing a pinball machine at a cost of $10,650 to induce or reward Mr Smith to show favour to Mr Balicevac and SIG in relation to the provision of security guarding services to the University. Mr Balicevac arranged for Mr Lu to contribute $6,000 to the cost of the pinball machine (no finding is made against Mr Lu in relation to the pinball machine).
Mr Smith engaged in serious corrupt conduct by accepting, or agreeing to accept, the above gifts, as an inducement or reward to use his position at the University to favour SIG’s interests.
The Commission is satisfied that the University’s tender process for the provision of security services and its lack of a robust contract management framework may have contributed to the occurrence of corrupt conduct found in this investigation. The report also notes that the practice of ghosting at the University created the likelihood that campus safety was compromised. The Commission has made 24 corruption prevention recommendations to assist the University to improve its systems.
The ICAC is also of the opinion that consideration should be given to obtaining the advice of the Director of Public Prosecutions with respect to the prosecution of Mr Balicevac, Mr McCreadie, Mr Lu, Mr Boutros, Mr Sirour and Mr Smith for various offences.
As part of the investigation, the Commission held a public inquiry over 14 days from 11 to 28 February 2019. Commissioner Stephen Rushton SC presided at the public inquiry, at which evidence was taken from 19 witnesses.