Manus contractor boss paid $1.2m to mother working at Home Affairs

The majority owner of the company that ran Manus Island’s immigration detention centre insists he was only trying to help his mother, who works in the Home Affairs Department, when he transferred more than $1.2 million to her in a series of payments.

The forerunner to the new National Anti-Corruption Commission has investigated the payments and is due to report its findings soon. Some payments were made while the $500 million Home Affairs asylum seeker contract was under way, and several were incorrectly invoiced as “consulting services” and charged via PayPal.

Paladin founder and majority shareholder Craig Thrupp.

Paladin’s majority owner, Craig Thrupp, defended the payments, saying his mother had never provided “confidential or inside information” and that he had appropriately disclosed her employment with the department when Paladin had started negotiations for an offshore processing contract in July 2017.

She worked “in the administrative section [of the department] preparing the annual report”, he said.

The Australian Commission for Law Enforcement Integrity’s inquiry into the payments, code-named Operation Bannister, looked into an alleged “corruption issue regarding a series of financial transactions from Paladin accounts to a Home Affairs employee between 2017 and 2020”, an NACC spokesperson said on Tuesday.

While the probe was completed before the NACC’s formation this month, the spokesperson said the investigation report was still being prepared, and it would be premature to disclose any findings until it was complete.

‘I am her son and I was supporting my mother.’

Craig Thrupp, Paladin majority owner

Asked how much he or Paladin had paid, Thrupp said: “I did not ‘pay’ my mother anything – I did transfer her some amounts as an individual – I am her son and I was supporting my mother.”

This support had amounted to Papua New Guinean kina worth about $222,000 and another $44,500 in Australian dollars, he said.

“I also gave both my mother and father $1 million each from my personal account in late 2017. Applicable tax was paid on all transfers,” Thrupp said.

He said his mother’s “status as a Home Affairs employee has no connection whatsoever to the payments”.

Two sources with direct knowledge of the payments said one of them was for $300,000 and made via PayPal. PayPal invoices for a number of the payments to Thrupp’s mother recorded they were for “consulting services”.

Thrupp agreed this was inaccurate, but denied the invoices had been falsified.

“The invoices incorrectly state ‘consulting services’. They should have stated gift or similar,” he said in a statement to this masthead’s Home Truths investigation. “This is an error as she never worked for or provided consulting services to Paladin.”

The flow of large sums of money from Home Affairs to an offshore processing contractor and back to a Home Affairs official raises questions about perceptions of conflict of interest. It also underscores the huge taxpayer-funded profits made by offshore processing contractors including Paladin, Canstruct and Broadspectrum.

Paladin secured the lucrative Manus contract from the Home Affairs Department without a tender in mid-2017. It was ultimately paid $532 million to run the service. Financial reports show that Thrupp, who owned 80 per cent of Paladin, was paid a dividend of $40 million in 2019.

Thrupp said he was transparent with his company about the payments to his mother.

“All payments were reconciled as director/shareholder payments on the PNG company account statement, audited ... and applicable taxes paid in PNG,” he said.

He also insisted he was not aware “of the details of any confidential investigation by NACC”.

Paladin also hired to the company board a former Home Affairs official who had worked on the offshore processing program.

Thrupp said the official was hired because of the deep knowledge he gained while working as a public servant on offshore processing.

Earlier this week, Home Truths revealed how the department had paid millions in taxpayer dollars to allegedly corrupt Pacific Island politicians and officials hired as subcontractors by Home Affairs’ lead contractors in Nauru and PNG. Paladin, Broadspectrum and Canstruct have all been implicated in suspect payments to officials, according to leaked documents and whistleblower testimony.

Some of the payments were authorised by Home Affairs despite warnings from Australian law enforcement agencies that some of the companies or foreign officials getting them were allegedly corrupt.

A former director of Paladin, Ian Stewart, revealed that in September 2018 Paladin had made multimillion-dollar payments that he claimed were bribes to secure work permits and visas for its offshore processing staff in PNG, and that Home Affairs had failed to act on corruption warnings. Stewart is not connected to the payments involving the Home Affairs official.

Thrupp told this masthead that he was removed from the Home Affairs contract at Paladin in May 2018, before the suspect payments were made. He said he was not aware of any bribes being paid.

The revelations have sparked calls by the Greens and crossbenchers for a commission of inquiry.

Home Affairs Minister Clare O’Neil says the Albanese government has a zero-tolerance approach to corruption.Credit: Alex Ellinghausen

On Tuesday night, Home Affairs Minister Clare O’Neil said the claims of improper use of taxpayer dollars by companies contracted by Home Affairs were “deeply concerning” and she would respond more fully after reviewing information revealed in the investigative series.

Earlier, Prime Minister Anthony Albanese said Opposition Leader Peter Dutton needed to front up over “serious allegations” that Home Affairs gave a multimillion-dollar offshore detention contract to an Australian businessman just a month after federal police told Dutton, who was then the relevant minister, that the man was under investigation for bribery.

“It has been suggested that he [Dutton] was warned ... the people deserve an explanation about these events,” Albanese said.

“This is taxpayers’ money and Mr Dutton has a responsibility to explain what occurred on his watch as home affairs minister with this scandal.”

NSW Labor MP Mike Freelander said although he preferred not to second-guess his colleagues, he believed there should be an independent inquiry. Tasmanian independent MP and integrity campaigner Andrew Wilkie called on the government to “act quickly to investigate the matter” and urged Dutton to address parliament next week.

Independent MPs Dr Sophie Scamps, Allegra Spender and Zali Steggall all called for an investigation, with Scamps urging the government to either establish an inquiry or refer the matter to the National Anti-Corruption Commission.

However, Steggall said any NACC probe would likely be behind closed doors.

“I believe there should be a royal commission into offshore detention so that this whole policy area can be publicly examined,” she said.

With Angus Thompson

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