Inside story: How it all unravelled for Cronulla Sharks
Earlier this year Cronulla hired an ex-NRL salary cap auditor to ensure all management policies and procedures were in order. What he stumbled over in week one of the job has left the club in crisis.
It all began to unravel for the Cronulla Sharks not long after former Rothmans Medal winner and local hero Barry Russell was appointed chief executive of the Cronulla Sharks in February.
The former Harvey Norman Commercial executive hired ex-NRL salary cap auditor Jamie L’Oste Brown in a new role as compliance governance manager to ensure all management policies and procedures were in order.
L’Oste Brown had 20 years’ experience at NRL headquarters. He’d seen everything from the multimillion-dollar Parramatta Eels’ 2016 scandal to more minor cases of dodgy third-party payments and players that got cars that they shouldn’t have.
What he stumbled over in week one of the job has now left the Sharks in crisis with their coach’s job on the line and question marks over officials who are still employed in the game.
A senior finance employee at the Sharks handed L’Oste Brown a file from 2015 that was highly suspicious.
Inside was an invoice from a telecommunications company for $100,000 for products and services that were never delivered. Plus a bank loan to pay the invoice.
The club is still paying off that loan. L’Oste Brown took the file to Russell.
It would have been tempting for the new CEO to throw it in the bin.
But how can you hire a compliance manager and then ignore what he has uncovered in week one? There was no turning back.
Russell took his concerns to the Sharks board with a recommendation they self-report to the NRL integrity unit.
The board, led by chairman Dino Mezzatesta, backed him, expecting a worst-case scenario of a mid-range fine. Maybe $100,000 and certainly a discount for their honesty.
Mezzatesta is chief operating officer of The Star casino and as squeaky clean as you have to be in a massive gaming industry where integrity and compliance is everything.
What they didn’t anticipate was the reaction from the integrity unit and the expectation that this would be treated as a one-off case.
Integrity unit boss, Todd Greenberg’s second-in-command Nick Weeks, sent in his team of forensic cyber experts.
They scanned the club’s internet server for emails, took laptops and mobile phones.
The Flanagan emails from 2014 — the year of his suspension — were uncovered.
Investigators have now spent six months interviewing players, managers and officials.
Two board members have since stood down.
A couple of interesting questions have been raised.
Is it right for the integrity unit to go delving into historic unrelated issues when a club has been honest enough to self-report salary cap issues?
And has the integrity unit now taken away the incentive for clubs to be truthful, up front and proactive with dubious player payments?
Remaining silent is now a possible option.
Or better still … just be honest in the first place and don’t rort the cap.
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