Investigation into the conduct of a then manager and-a former contractor at-Canterbury-Bankstown Council (Operation-Mantis)

Summary

The report's own summary: Chapter 1: Overview, pages 9 to 17

Findings, opinions and statements 6

Allegations are not findings. A commission's finding or opinion of corrupt conduct or misconduct is not a finding that a person is guilty of a criminal offence, and the commissions say so in their reports.

1. serious corrupt conduct

   Finding

   The Commission found that Mr Webb engaged in serious corrupt conduct in connection with the recruitment scheme (see chapter 4) by: • between about 1 January 2021 and 9 December 2022, misusing his public official functions as Council’s manager of works and projects to facilitate the engagement of contingent workers through PMLV, a company run by his friend Mr Cossu, by approving their engagement and/or determining to add more workers to Council’s Works and Projects Unit, in return for which he received approximately $208,000 during the period that he worked at Council • between about 1 January 2021 and 9 December 2022, in breach of the Council Code of Conduct, submitting false or misleading written returns of interest in which he failed to disclose: – the receipt of benefits from Mr Cossu and PMLV – his bankruptcy status and associated debts – the receipt of a gift or benefit under clause 6 of the Code of Conduct.

   Report, page 13, Summary of investigation and outcomes

2. serious corrupt conduct

   Finding

   The Commission found that Mr Cossu engaged in serious corrupt conduct in connection with the recruitment scheme (see chapter 4) by: • between about 1 January 2021 and 20 December 2022, by arrangement with Mr Webb, supplying contingent workers to Council through his company PMLV, in return for which Mr Webb misused his public official functions as Council’s manager of works and projects to engage and retain PMLV candidates at Council. Mr Cossu gave Mr Webb approximately $208,000.

   Report, page 13, Summary of investigation and outcomes

3. Section 74A(2) statement

   Prosecution statement

   The Commission is of the opinion that consideration should be given to obtaining the advice of the Director of Public Prosecutions (DPP) with respect to the prosecution of the following persons: Benjamin Webb • for the criminal offence of corruptly receiving financial benefits from Mr Cossu or his company, PMLV, in relation to Council engaging PMLV candidates contrary to s 249B(1) of the Crimes Act 1900 (NSW) (“the Crimes Act”). Pietro Cossu • for the criminal offence of corruptly giving financial benefits to Mr Webb, an agent of Council, in relation to Council engaging PMLV candidates contrary to s 249B(2) of the Crimes Act.

   Report, page 13, Summary of investigation and outcomes

4. serious corrupt conduct

   Finding

   The Commission finds that Mr Cossu engaged in serious corrupt conduct in connection with the procurement arrangement (see chapter 5) by: • between mid-2020 and late 2022, misusing his public official functions by assisting Mr Clarke and his company, GWAC, to win Council projects and maximise his financial gain from the projects (including through variations), by utilising the information and opportunities available to Mr Cossu through his position at Council.

   Report, page 14, Summary of investigation and outcomes

5. serious corrupt conduct

   Finding

   The Commission finds that Mr Clarke engaged in serious corrupt conduct in connection with the procurement arrangement (see chapter 5) by: • between mid-2020 and late 2022, rewarding Mr Cossu for assisting Mr Clarke and his company, GWAC, to win Council projects and maximise GWAC’s financial gain from the projects (including through variations).

   Report, page 14, Summary of investigation and outcomes

6. Section 74A(2) statement

   Prosecution statement

   The Commission is of the opinion that consideration should be given to obtaining the advice of the DPP with respect to the prosecution of the following persons: Pietro Cossu • for the criminal offence of corruptly receiving financial benefits from Mr Clarke or his company, GWAC, in relation to GWAC being awarded projects at Council, contrary to s 249B(1) of the Crimes Act. Jeremy Clarke • for the criminal offence of corruptly giving financial benefits to Mr Cossu, an agent of Council, in relation to GWAC being awarded projects at Council, contrary to s 249B(2) of the Crimes Act.

   Report, page 14, Summary of investigation and outcomes

Recommendations 19

1. Recommendation 1

   That Council adopts better-practice employment-screening measures that include: • more extensive screening for higher-risk roles, in line with a risk-based approach • confirmation – where a position has been identified as requiring a criminal record check – that this check is completed and used to inform the hiring decision • contact with issuing institutions to verify academic qualifications • financial checks on candidates for managerial roles with financial delegations.

   here, page 1

2. Recommendation 2

   That Council retains documents from recruitment interviews and evidence justifying the selection of the preferred applicant.

   here, page 1

3. Recommendation 3

   That Council adopts better practice guidelines on contingent workforce management that incorporate: • workforce planning • a requirement to consider alternative recruitment solutions to fill roles • controls to limit the tenure of contingent workers, including reviews to determine whether contingent roles should be converted to permanent appointments.

   here, page 1

4. Recommendation 4

   That Council adopts measures to address the risks associated with contingent labour, including: • placing contingent labour on its risk register(s) • performing a formal risk assessment to help inform when and how contingent labour should be used.

   here, page 1

5. Recommendation 5

   That Council implements measures to eliminate absolute control of hiring managers in the contingent-labour hiring and management process. In particular, Council should consider giving human resources a role in approving appointments.

   here, page 1

6. Recommendation 6

   That Council collects detailed and accurate financial and workforce data on contingent workers and shares this information with key stakeholders, including the Executive Leadership Team.

   here, page 1

7. Recommendation 7

   That Council: • ensures it retains copies of price schedules for different job grades and bands • instructs hiring managers and human resources staff to consider these price schedules in their recruitment processes • embeds internal financial controls to ensure that contingent rates are justified • confirms a contingent worker’s rate of pay with the contingent worker when they are initially engaged.

   here, page 2

8. Recommendation 8

   That Council adopts measures to ensure that: • it is notified of any proposed subcontracting arrangements involving contingent-labour suppliers, and approval for these arrangements is sought from senior levels within Council and not the business unit engaging the contingent worker • panels, managed service providers, contingent-labour suppliers and subcontractors all have a robust assurance framework in place to ensure they can deliver services in line with the contract.

   here, page 2

9. Recommendation 9

   That Council requires managed service providers to: • attest that they are not aware of any conflicts of interest involved in contingent hiring arrangements • ensure all parties in the supply chain are provided with a conflict of interest definition • place a requirement on all parties in the supply chain to attest that they are not aware of any conflicts of interest involved in contingent hiring arrangements.

   here, page 2

10. Recommendation 10

    That Council ensures that high-quality employment screening checks are performed on contingent workers and that Council periodically examines the quality of checks performed by suppliers involved in recruitment.

    here, page 2

11. Recommendation 11

    That Council provides: • contingent workers with induction and ongoing training that explains what corruption is and how to report it • contingent workers with the opportunity to raise concerns regarding workplace performance during an off-boarding process • all staff, including contingent workers, with training on how to make and receive (where relevant) public interest disclosures. Aspects of this recommendation may be modified for extremely short-term contingent labour.

    here, page 2

12. Recommendation 12

    That Council reviews its processes to ensure that the planning of capital works is based on finalised designs or detailed project briefs, robust cost estimates, scope-management plans and scopes of works that are commensurate with the size, risk and complexity of a project.

    here, page 3

13. Recommendation 13

    That Council reviews its procedures and processes for capital works procurement to ensure: • compliance with procurement dollar thresholds, particularly in relation to the splitting of orders • purchase orders are raised for the correct amount • specifications and assessment criteria are: o complete and aligned with evaluation plans o explained in sufficient detail o adequate to assess key contract risks o internally consistent across documents • closing dates are not extended to unfairly advantage potential contractors • potential contractors are not unfairly excluded from procurement exercises and that reasons are provided for excluding bidders.

    here, page 3

14. Recommendation 14

    That Council adopts a robust contractor selection framework that includes: • verifying claims made by potential contractors • processes to follow up red flags in relation to the capability and capacity of potential contractors • assessing project-delivery methodologies, including consideration of the capabilities and insurances of nominated subcontractors • obtaining assurances regarding compliance with design and safety specifications.

    here, page 3

15. Recommendation 15

    That Council ensures that contractor selection reports contain adequate information to enable the approving officer to understand key issues. The information should include: • a realistic and detailed assessment of key procurement and contract risks and the corresponding mitigation strategies • any significant probity concerns that arose during the procurement exercise and how they were resolved • any clarifications that were issued to tenderers.

    here, page 3

16. Recommendation 16

    That Council conducts a detailed risk assessment regarding information security related to procurement exercises and identifies and implements controls to enhance the security of information. The review should consider: • the use of an electronic submission box for the receipt of all quotations and tender clarifications • the timing of the release of this information by the Procurement Service unit.

    here, page 3

17. Recommendation 17

    That Council implements a contract-variation process for capital works that requires: • requests to proceed with project variations to be approved and supported by evidence, such as photographs and/or written requests from asset owners in advance of the proposed work being undertaken • competitive quotations for changes to scopes of works above a certain amount or threshold (to be determined by Council) where the nature of the work allows • requests for variations to be communicated in writing to contractors • controls to identify when project variations exceed 15% of the original contract amount and aggregated periodic reporting to the director city assets of such situations. An exception to the above requirements should be permitted for emergency situations where appropriate.

    here, page 4

18. Recommendation 18

    That Council enhances its project-management framework for large scale capital works to ensure: • contractors making payment requests (including those related to the payment of variations) are required to provide documented proof of works such as receipts for materials, evidence of contractor hours and time stamped photographs of works • quality checks are conducted at critical work stages and documentation collected on compliance with specifications • a risk-management framework is implemented that complies with the principles in A/NZ ISO 31000:2018 Risk management – Guidelines • there is monitoring and reporting of project budgets and the progress of work • project debriefs are undertaken to identify key areas for improvement.

    here, page 4

19. Recommendation 19

    That Council amends its conflicts of interest procedures to ensure that: • staff are prompted to declare conflicts of interest at the start of a procurement exercise, as well as after the tender box opening • all conflicts of interest declarations are placed on its central register • relevant management and staff are informed when people are removed from a procurement process due to a conflict of interest • conflicts of interest management plans are established for staff excluded from a procurement process due to a conflict of interest with the selected contractor.

    here, page 4

Published responses 2

• Action plan - 12 month progress report - Canterbury-Bankstown Council (CBC) (pdf)

  Progress report

• Action Plan - Canterbury-Bankstown Council (CBC) (pdf)

  Action plan

Official documents 2

• Investigation into the conduct of a then manager and-a former contractor at-Canterbury-Bankstown Council (Operation-Mantis)

  Report · 140 pages

  Document details

  Role

  Report

• here

  Recommendations

  Document details

  Role

  Recommendations

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