Objective, Scope and Methodology: As identified in the Councils fraud and corruption mitigation strategy, internal audit has:
Reviewed ICAC reports relevant to local government in the period to the date of the Audit Committee;
Followed up with Council management those recommendations made by the ICAC that relate to the activities that are undertaken by Council. This follow up is undertaken to ensure that Councils processes are corruption resistant;
Worked with management to implement or modify processes where relevant, to mitigate the corruption risk.
For the information of the Committee:
Since 2008 the ICAC has made 278 recommendations (similar recommendations counted as 1) that relate to activities undertaken by Council. Audit has followed up the recommendations made by the ICAC when the relevant reports have been published.
Council manages its corruption risks through its online risk management system.
a) ICAC Investigations and OLG public enquiries in progress
The ICAC’s ongoing investigations are as follows (Please note that the following extracts are copied directly from the ICAC website Link:
http://www.icac.nsw.gov.au/investigations/current-investigations):
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2017
NSW Health and the Department of Family and Community Services - allegations concerning the former CEO of the Immigrant Women’s Health Service and the Non-English Speaking Housing Women’s Scheme Inc (Operation Tarlo)
The ICAC is investigating corruption allegations concerning Emman Sharobeem, the former CEO of the Immigrant Women’s Health Service(IWHS) and the Non-English Speaking Housing Women’s Scheme Inc (NESH).
The allegations include that Ms Sharobeem dishonestly exercised her official functions as IWHS CEO by: between 1 July 2009 and 17 February 2016, submitting invoices for reimbursement for goods and services to which she was not entitled and using an IWHS credit card to pay for personal expenses; between 2014 and 2015 submitting, and authorising payment by IWHS of, false invoices for facilitation fees and other services to herself and other persons to which they were not entitled; between 2011 and 2015, submitting, and authorising payment of, invoices by the IWHS for the renovation of her property in Fairfield; and between 2012 and 2014, falsifying IWHS statistics to NSW Health.
Ms Sharobeem is also alleged to have dishonestly exercised her official functions between 2006 and 2016 by claiming to be a psychologist holding two PhD degrees and a masters degree, and further using those qualifications to treat IWHS clients and gain promotion to the position of CEO of the IWHS and the NESH. As NESH CEO, Ms Sharobeem is alleged to have dishonestly exercised her official functions between 17 December 2013 and 23 November 2015 by authorising payments from NESH to be made to her own account, to which she was not entitled.
Between March 2011 and November 2016, Ms Sharobeem is also alleged to have fraudulently obtained and retained appointment as a Board member of the Community Relations Commission (now Multicultural NSW) and the Anti-Discrimination Board (now part of the Department of Justice) by using false academic qualifications.
The IWHS was a not-for-profit non-government organisation (NGO) women’s health service, primarily funded by NSW Health via South West Sydney Local Health District, while the NESH was a not-for-profit NGO contracted and funded by the Department of Family and Community Services to provide affordable housing to women and children. In her capacity as CEO, Ms Sharobeem was a public official for the purposes of the
Independent Commission Against Corruption Act 1988.
Note: the Operation Tarlo public inquiry concluded 13/7/2017.
2016
City of Botany Bay Council – allegations concerning former chief financial officer (Operation Ricco)
The ICAC is investigating allegations that former City of Botany Bay Council chief financial officer Gary Goodman, and other Council employees, dishonestly exercised official
functions to obtain financial benefits for themselves and others by causing fraudulent payments of more than $4.2 million to be made by the Council through false invoicing to either themselves, or various entities. The ICAC is also investigating allegations that Mr Goodman solicited and received payments as an inducement or reward for showing favourable treatment to contractors. It is also alleged that Mr Goodman and other Council employees dishonestly exercised official functions to obtain financial benefits for
themselves and others by using Council resources.
2014
NSW public officials and members of Parliament – allegations concerning corrupt conduct involving Australian Water Holdings Pty Ltd (Operation Credo)
The ICAC is investigating allegations that persons with an interest in Australian Water Holdings Pty Ltd (AWH) obtained a financial benefit through adversely affecting the official functions of Sydney Water Corporation (SWC) by: including expenses incurred in other business pursuits in claims made on SWC for work on the North West Growth Centre;
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drawing from funds allocated for other purposes; and preventing SWC from ascertaining the true financial position, including the level of the executives’ remuneration.
The Commission is also investigating whether public officials and others were involved in the falsification of a cabinet minute relating to a public private partnership proposal made by AWH intended to mislead the NSW Government Budget Cabinet Committee and obtain a benefit for AWH, and other related matters.
The Commission has been unable to progress the publication of the Operation Credo report owing to the criminal proceedings being conducted by the Director of Public Prosecutions against Mr Edward Obeid and Mr Moses Obeid. While those proceedings arise out of the Operation Jasper investigation, the Commission is of the view, in accordance with section 18 of the Independent Commission Against Corruption Act 1988, that the publication of the Operation Credo report during the currency of criminal proceedings may prejudice the right of the accused to a fair trial.
As there are common elements to this investigation and Operation Spicer, the evidence taken in each operation is taken as evidence in both operations.
For information about the Operation Spicer report, published on 30 August 2016, visit this page.
In both operations Credo and Spicer, the Commission also investigated the circumstances in which false allegations of corruption were made against senior SWC executives.
b) ICAC Investigation Reports issued:
The following is a link to the ICAC reports publically listed:
Link: http://www.icac.nsw.gov.au/investigations/past-investigations In the period the following investigation report was issued in June 2017:
Western Sydney Regional Illegal Dumping Squad – allegations concerning former Western Sydney Regional Illegal Dumping Squad (RIDS) officer (Operation Scania)
The ICAC investigated allegations that a former Western Sydney Regional Illegal Dumping Squad (WS RIDS) enforcement officer, Craig Izzard, exercised his public official functions partially and dishonestly by receiving corrupt payments to ignore illegal dumping in areas under his supervision, or to impede investigations by other WS RIDS officers.
In summary:
The ICAC found that Craig Izzard engaged in serious corrupt conduct by:
from 2015, being party to an agreement where Ibrahim Beydoun paid $10,000 to Nosir Kabite, which Mr Kabite agreed to share with Mr Izzard, in return for which Mr Izzard improperly exercised his official functions to: intimidate Raed Ykmour into departing from 30 Bellfield Avenue, Rossmore, in order to assist Mr Beydoun to relocate his business to that property; assist Mr Beydoun to avoid detection of the illegal operation of his skip bin business at that site; assist Mr Beydoun with the development application for the operation of his skip bin business at the property
between September 2015 and March 2016, agreeing to receive from Kabite cash payments, and receiving at least two mobile telephones, firewood and free rubbish removal as a reward for assisting Mr Kabite by improperly exercising his official functions by deliberately failing to investigate the unlawful waste disposal activities and not enforcing waste disposal laws in relation to Mr Kabite’s operations at Bandon Road, Vineyard.
Nosir Kabite engaged in serious corrupt conduct by, from 2015, being a party to an agreement where he received $10,000 from Mr Beydoun, which he agreed to share with Mr Izzard, in return for Mr Izzard improperly exercising his official functions as described above.
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Ibrahim Beydoun engaged in serious corrupt conduct by, from 2015, being a party to an agreement whereby he paid $10,000 to Mr Kabite with the intention that Mr Kabite would share the money with a Liverpool Council Officer in return for that officer improperly exercising his official functions as described above.
The Commission also found that there were oversight weaknesses that created opportunities for corrupt conduct, and they have recommended a tighter regulatory response to illegal dumping, aided by the creation of a standalone offence for asbestos dumping and the establishment of a single entity to oversee asbestos waste.
The recommendations outlined in the report are aimed at strengthening the strategic oversight and governance framework for the WS RID squad; address problems associated with the incentives and motivations driving illegal dumping; and ensure a tighter
regulatory response to illegal dumping.
The ICAC is of the opinion that the advice of the Director of Public Prosecutions should be obtained with respect to the prosecution of Mr Izzard, Mr Kabite and Mr Beydoun for various offences.
The Commission has made 15 corruption prevention recommendations to improve the regulatory response and to address other issues and concerns raised in this investigation.
For the information of the Audit Committee: This full report was referred to Council on 8 August 2017. Although the activities investigated did not involve the Hills Shire Council area or its activities (no complaint or request for further information has been received), the report was distributed to inform the Council of the investigations findings and recommendations as the Hills Shire Council has been a member of the Western Sydney RID Squad (WS RID Squad) since 1 December 2002.
The full ICAC report is located at: http://www.icac.nsw.gov.au/investigations/past- investigations/investigationdetail/222.
The implementation of the recommendations relating to Council will be monitored through the Councils Audit Committee. Please note that the response to the recommendations raised in the report will be published on the ICAC website.
c) ICAC: Other relevant corruption prevention publications released
No other relevant corruption prevention publications have been released in the period.
d) Office of Local Government (OLG) Public Enquiries
The public enquiries that are being undertaken by the OLG are detailed at the following link: http://www.olg.nsw.gov.au/public-inquiries
No public enquiries were undertaken by the OLG in the period.