Federal union regulation launches another investigation into Qld CFMEU spending

A federal watchdog has launched an investigation into the Queensland CFMEU branch over the alleged misuse of corporate credit cards, with the branch’s president under investigation for an alleged unauthorised expenditure exceeding $6,700.

The federal union regulator has started a second action against the Queensland branch of the CFMEU over the alleged misuse of members’ funds.

And it has asked for an independent audit to ensure the branch operated within the rules of the Fair Work Act.

Registered Organisations Commissioner, Mark Bielecki said an initial investigation arose following an auditor’s report about a “deficiency” in the district branch’s financial statement for the year ended 30 June 2016.

In a statement Mr Bielecki said the auditor was unable to “obtain sufficient appropriate evidence to verify that all of the credit card expenses ($721,116) that have been included as business expenses in the union’s annual financial statements have been incurred solely for business purposes”.

An independent auditor first raised questions in his October 2016 report over the use of credit cards by union executives in the Queensland branch of the CFMEU mining division. Picture: Glenn Hampson

Mr Bielecki said he was satisfied the district branch failed to keep complete and proper documents in relation to credit card transactions to demonstrate that all expenditure related to business activities and was properly authorised.

Furthermore, it is claimed the branch “failed to keep proper records in relation to a related party loan to the branch President Mr Stephen Smyth, as a result of which the Commission could not determine whether personal benefits received were repaid”.

Mr Bielecki claimed the Board of Management of the branch “failed to approve numerous loans, grants and donations exceeding $1,000, particularly where they were made by lodges as required by district branch rules”.

The branch also “failed to have in force or implement internal control policies and procedures relating to expenditure to ensure good governance and accountability”, he claimed.

He said the board had to rectify these matters to comply with the union’s national rules and the Fair Work Act.

CFMEU Queensland branch president Stephen Smyth is personally under investigation over alleged unauthorised use of funds. Picture: Parliament livestream

Mr Bielecki added: “Separately, the Commissioner has commenced civil penalty proceedings against the District Branch’s President (Smyth) regarding alleged unauthorised expenditure exceeding $6,700.”

A statement of claim shows Mr Smyth is to face the Federal Court accused of using union funds on home plumbing, personal dental costs, driver’s licence renewal, car hire while on annual leave in the US, and travel and meals for himself and his family.

In that action Mr Bielecki alleges that Mr Smyth regularly used the district branch’s funds for personal purposes not related to his employment, and which he was not authorised to incur.

The CFMEU has been approached for a comment.

Mr Smyth has not filed a defence.

Originally published as Federal union regulation launches another investigation into Qld CFMEU spending