By Nick McKenzie, Richard Baker and James Massola
The brother of Australia's Customs and border protection chief Michael Pezzullo will be sentenced for corruption charges on Tuesday in a development Labor and the Greens say the agency boss should have disclosed at a recent Senate estimates hearing.
Former Customs officer Fabio Pezzullo will be sentenced after agreeing to plead guilty to perjuring himself before Australia's corruption watchdog during an investigation into a corrupt ring of Customs officers at Sydney Airport.
Australian Customs and Border Protection Service CEO Michael Pezzullo.Credit: Alex Ellinghausen
Mr Pezzullo was charged earlier this year after an 18-month investigation over allegations he sold prescription drug Kamagra to fellow Sydney Airport Customs officers and lied to the Australian Commission for Law Enforcement Integrity unit, which was investigating several of his colleagues for drug importation and bribery offences.
Fairfax Media can also reveal:
■ Fabio Pezzullo attended a customs function in June last year where he mixed with serving officers, despite having been suspended for alleged corruption;
■ Other corrupt former customs staff have pleaded guilty and agreed to testify against fellow officers in a key development in the Sydney Airport inquiry since arrests were first made in 2012;
■ The Australian Crime Commission and Customs are ramping up a new taskforce in response to intelligence revealing Customs continues to face corruption problems, including staff with links to serious organised crime identities.
Fairfax Media can also reveal that recent reforms of Customs' internal affairs division, including the removal of experienced criminal investigators, has sparked accusations from insiders the agency is leaving itself vulnerable to further integrity problems. Some staff are also angry that managers at Sydney Airport, under whose watch corruption flourished, remain in their positions.
But senior government sources have backed Mr Michael Pezzullo's efforts to tackle integrity concerns inside Customs, including pushing the work of Taskforce Pharos and the increased targeting of staff with drug and background checks.
Pharos involves the Australian Crime Commission using its criminal database to examine any suspicious associations and financial activity involving Customs staff.
A senior Customs source said Mr Pezzullo did not disclose the charging of his brother with corruption offences when he updated a Senate committee on May 26 about the Customs corruption scandal because he was being ''legally cautious'' and was not aware of the details surrounding it.
On Monday evening, a Customs spokeswoman said Mr Pezzullo ''had not been briefed on matters concerning Fabio Pezzullo at the time of giving his opening statement to Senate estimates on 26 May''.
But Labor senators Joe Ludwig, Lisa Singh and Sam Dastyari, who attended the hearing, said the Customs chief should have told them about the charging of his brother.
''He should have given a full and frank account about his brother's criminal charges. This would have avoided any perception of a conflict of interest,'' Senator Dastyari said.
A looming integrity challenge for Customs will be the merging next year of the agency with the Immigration Department to create a new border force.
The Immigration Department is not scrutinised by the nation's corruption watchdog ACLEI, unlike Customs, the crime commission and the federal police.
Fabio Pezzullo is listed to appear before the Downing Centre Court in Sydney along with fellow accused customs officer Rod Freeman on Tuesday. Both have pleaded guilty to misleading ACLEI.
Nick McKenzie on Twitter @ageinvestigates