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Leaders of the police taskforce established by the Allan government to tackle Big Build corruption have declared there is “no doubt” organised criminals have infiltrated the construction program, and warned combating the sector’s entrenched problems will require legislative change.
As Premier Jacinta Allan said on Monday that she could not understand why people with evidence would not come forward to police, officers also described a struggle to recruit witnesses against the gangland figures profiting from the building sector because Victorians were terrified they would be threatened, firebombed or have their business shut down.
The police officers leading Taskforce Hawk, the elite squad created to combat crime and corruption on the state’s Big Build and in the wider construction sector, also used an exclusive interview with this masthead to accuse Victoria’s largest contractors of failing to ensure they are resistant to organised crime infiltration.
While the police were careful in the interview with this masthead not to mention the Labor government – which on Monday flagged with contractors it would tighten rules on industrial fixers – or stray into political commentary, they were unequivocal that gangland-linked corruption had spread for years throughout the government’s $100 billion Big Build infrastructure program and that new laws were needed to confront it.
They described the wrongdoing as “clearly organised, clearly strategic” but often “out of our remit”.
Allan has pinned her response to the crisis on an insistence that Victoria Police has the powers and the capacity to combat the corruption scandal enveloping her leadership and government.
At a lengthy and testy press conference on Monday, she again insisted police had the powers to combat the scandal and refused to acknowledge the fact of corruption on the scheme she oversaw for years as minister.
In the face of questioning about this masthead’s revelations over the weekend about the costs of the CFMEU’s lawless conduct, fresh calls from ex-corruption watchdogs for a royal commission and the ongoing role of gangland figures such as Mick Gatto in the construction sector, Allan repeatedly said she could not understand why witnesses were not reporting suspected Big Build corruption to police.
In the interview with police, the three officers leading Taskforce Hawk said new laws were needed to combat construction sector corruption as some of the uncovered wrongdoing was not a crime that police had the power to investigate.
Hawk boss Superintendent Dave Cowan revealed his detectives had identified “a select number of organised crime figures who are adapting an organised crime model to apply it in any way that they can to secure the most amount of money they can under contracts for the Big Build”.
“There’s no doubt that that’s been happening,” Cowan said.
He said Taskforce Hawk had established that rorting was occurring on government projects, including through unnecessary traffic management labour hire, but it formed a “grey corruption” area that could not be probed by state police because the wrongdoing was not captured by Victoria’s criminal laws.
“We are tackling the business model that organised crime have adapted to exploit the industry, and this is taxpayers’ money. This is infrastructure that the public owns,” he said. “[But] the grey space of corruption is much broader than the criminality remit that we have.”
Cowan said it was not the job of Taskforce Hawk to estimate how much money had been ripped from the Big Build and would not be drawn on whether corruption-busting lawyer Geoffrey Watson’s controversial $15 billion estimate was accurate.
Cowan stressed that because state police could not deal with a range of “grey space” activities, the force was exchanging information with other law enforcement agencies.
“There’s a lot of actions that enable that [corruption to] occur prior to criminal conduct being committed,” he said.
Cowan said this involved how gangland players “secure labour hire contracts, how they set up companies, how they use influence across a criminal network to influence commercial decisions”.
Allan has repeatedly refused to provide an estimate of the cost of Big Build corruption, even after correspondence published by this masthead on Saturday revealed claims the state government had endorsed CFMEU action that had cost the Metro Tunnel project an unnecessary $200 million.
Cowan said he suspected labour-hire rorting cases “significantly add to costs of contracts and the build of infrastructure in this state” but that estimating the loss to taxpayers was an issue for regulatory agencies and the government.
The police comments come as a 2018 tweet from Allan’s husband, former CFMEU official Yorick Piper, emerged in which he appears to be attacking 2014 royal commission testimony by then Victoria Police assistant commissioner Stephen Fontana about the force’s concerns bikies were infiltrating the union.
In the tweet, Piper said the concerns about the CFMEU were a “load of rubbish” in response.
Taskforce Hawk’s second in charge, Detective Inspector Ross Mitchell, said that over two years, his investigators had made significant progress mapping an industry cloaked in the “extreme” fear of reprisal and in which it was “easier probably to just sort of pay the criminals to go away”.
On Sunday night, this masthead and 60 Minutes revealed Mick Gatto was still earning large sums helping Big Build subcontractors gain access to or remain on major project sites and had received large payments as recently as this year.
Asked why well-known underworld figures were still getting paid to represent companies on the Big Build as so-called “industrial relations mediators” or debt collectors, Mitchell and Taskforce Hawk’s lead detective, Randeep Atwal, both pointed to major legislative gaps.
“From a police perspective, it’s not something that we have the power to investigate, unless we have a witness come forward and say ‘I was blackmailed to make a payment, I was extorted to make this payment’,” Atwal said.
He stressed, though, that the payments to gangland figures “raised a lot of questions” and Hawk was “desperate for a witness to come forward” and agree to testify about the payments.
Mitchell said there was “no doubt” law reform was needed and Hawk was pushing hard for “the legislative change that is needed” to regulate debt collectors and industrial union fixers such as Gatto, who has denied all wrongdoing and insisted he runs a legitimate mediation business.
“There’s no doubt there needs to be character testing,” Mitchell said. “There’s certain people that shouldn’t be in that industry and undertaking certain behaviours, whether it be debt collecting or as industry fixers.”
On Monday, Transport Infrastructure Minister Gabrielle Williams wrote to Big Build contractors noting “alarming reports regarding the questionable use of industrial mediators or ‘fixers’”.
Williams said the government infrastructure delivery agency (VIDA) would establish a mandatory register of approved industrial relations consultants and mediators.
While that was set up, Williams said, contractors would be asked to list as soon as possible all parties providing those services either to them or to any of their subcontractors as well as what services they were providing and what they were being paid.
Victoria Police has unsuccessfully pushed the government to regulate debt collectors for over a decade.
Mitchell also said that even with legislative change, police could not “arrest our way out” of the Building Bad scandal.
“Victoria Police can’t do this alone … there’s not going to be change in this industry unless everybody’s on board and everyone chooses to move forward with the change, and say that we’re not going to accept that the easiest way out of this situation is to pay a criminal,” he said.
Atwal said one of Hawk’s biggest challenges was getting witnesses to come forward.
“We’ve been running for a year now, and look, we can count on one hand the amount of people that have actually made a formal complaint to police,” he said, while also estimating there were “hundreds of people, if not more” who held the evidence to help police get to the bottom of crime in the sector.
Atwal is an experienced organised crime fighter who was recruited from the drug squad to lead a small team of Hawk detectives.
He said potential witnesses were “concerned about their personal safety ... but they also have a concern in relation to their business and what impact making a statement will have on their ability to continue working in the industry”.
He urged people to contact Hawk, assuring potential witnesses that police would use everything within their power to ensure they were supported.
On Monday, Allan said anyone with information about wrongdoing on the Big Build program should report it.
“I don’t understand why that wouldn’t be immediately provided to Victoria Police, because as Victoria Police have demonstrated, through the powers they have, [they] are taking action,” she said.
Taskforce Hawk has made several significant arrests, most notably of bikie gang leaders who previously worked on the Big Build.
It has also arrested former senior union officials over relatively minor criminal offending as part of a disrupt-and-deter approach that extended to a recent raid on Mick Gatto’s home in connection with allegations of speeding demerit point fraud. The taskforce has not yet laid a single charge in relation to Big Build corruption.
Echoing criticisms from Victoria’s Labour Hire Commissioner, Steve Dargavel, reported by this masthead on Sunday, Mitchell, who has led complex fraud and corruption investigations at Victoria Police for more than 20 years, said the major Big Build contractors also needed to do more to help police.
“I need them to engage with us on a greater level than they have been,” he said.
Superintendent Cowan agreed it was not down to the police to stop payments from Big Build firms to identities such as Gatto.
“There needs to be a fundamental shift in the industry around how they go about engaging contractors,” he said.
“Principal contractors and all contractors have an obligation to ensure that that money is spent appropriately, and that they’re not involving criminal entities who will go on to exploit, intimidate, before any crime is committed.
“We also need to get to a point where principal contractors realise that they’re only going to get the work when they can demonstrate that they have built resilience to the infiltration of organised crime ... I don’t think we’re actually there yet, because we know that some of these characters within the industry are still being engaged.”
Mitchell said he was encouraged that the Victorians from the building industry that are engaging with Hawk were fed up with the corruption.
“I get a sense that people are sick of it, and I think that the legitimate hardworking people are sick of the previous culture and the ability for this industry to have been taken advantage of,” he said.
Read more:
‘Don’t pay Gatto, don’t get access’: Companies with gangland figure on payroll
