African community leader accused of fraud hospitalised

Abeselom Nega, who is accused of gambling $2.4m away after allegedly defrauding the government of $4m, says the case against him is adding to his mental health issues.

Abeselom Nega was expected to attend the Melbourne Magistrates’ Court on Wednesday but has been admitted to a private hospital for “ongoing care”.

A prominent African community leader accused of a $4m government fraud has been hospitalised over mental health issues.

Abeselom Nega was expected to attend the Melbourne Magistrates’ Court on Wednesday but his lawyers said the case against him was “adding to the difficulty” he was facing, and he had been admitted to a private hospital for “ongoing care”.

Mr Nega, 56, has been accused of a decade-long scam where police allege he dishonestly obtained $4.25m in state government funds from support programs he ran for troubled youths and refugees, and separately stole $25,300 from his company iEmpower, between 2008 and 2019.

Police also allege the Footscray man – facing 26 charges – gambled up to $2.4m away at Crown Casino.

Phoning into the court from hospital, Mr Nega was asked about his wellbeing by Magistrate Graeme Keil.

“No, I’m not alright, but I’m getting help,” he told the court.

A committal hearing testing the evidence against Mr Nega continued, where Mr Keil asked if his lawyers had considered a guilty plea and highlighted the “forensic nature” of the case.

“If there is an ideal time to plead guilty … this is the ideal time,” said Mr Keil, noting the “significant discount” given to those who pleaded during the pandemic.

But defence barrister Anthony Lewis declined the offer.

Abeselom Nega has been accused of a decade-long scam where police allege he dishonestly obtained $4.25m in state government funds.

David Arblaster, the former manager of the Department of Justice’s diversity issues unit, told the court he would find it “outrageous” if an agency awarded government funds for programs was to pocket cash.

Questioned by Mr Lewis over whether profitmaking private companies should be able to retain leftover funds once a service was provided, the former public servant said, “I actually don’t think it’s as black and white as that”.

“You’re not giving me a quantum of how much money we’re talking about,” Mr Arblaster replied.

“If you’re saying it’s a $1.2m contract … the agency spends $200k delivering the program and pockets a million, I would say that’s outrageous and a bad use of government funding.”

Mr Arblaster conceded he didn’t know how much money Mr Nega was accused of obtaining, stating “no-one’s told me what’s happened here and I’m in the dark”.

But he confirmed if he had been made aware that cash for programs was being pocketed then he would have made steps to terminate the agency’s funding agreement.

Mr Lewis noted iEmpower’s had provided a “significant benefit to the Victorian community” for steering disenfranchised young people from crime and into work and education – comments that were not disputed.

The court heard Mr Nega’s company avoided an official tender process for multimillion-dollar youth justice contracts because no other agency expressed interest in running them.

The original quote for the pilot program from iEmpower was $99,715 in 2008, which assisted 23 young people aged 18 to 24, helping them gain employment and return to tertiary and high school education, the court heard.

After a successful first year, the program was extended until it was shut down in 2019, a year before Mr Nega was charged.

The committal, before Mr Keil, continues.

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