Integrity chief took personal interest in Austal anti-corruption probe

The former head of Australia’s top anti-corruption agency flew to the United States to personally gather intelligence from American investigators for his probe into alleged corruption involving ASX-listed shipbuilder Austal.

Sources with knowledge of events, and social media posts at the time confirm that the Australian Commission for Law Enforcement Integrity's then-commissioner, Michael Griffin, travelled to Washington DC with the inquiry's former lawyer in the first week of September 2019.

Former ACLEI boss Michael Griffin flew to the US in September 2019 to personally oversee the Austal probe. Credit:

They were investigating an allegedly corrupt $39 million payment made by an Australian Border Force official to the ASX200 company and while in the US they received briefings from officials involved in the US Securities Exchange Commission and the Department of Justice investigations. Austal supplies both the Australian and US navies and is under investigation in both jurisdictions.

Corruption expert Geoffrey Watson, SC, said the fact that Mr Griffin and the barrister he appointed to run private anti-corruption hearings, Jonathan Hyde, made the trip suggests Mr Griffin prioritised the Austal probe, was personally overseeing it, and believed the use of extraordinary powers was required to expose wrongdoing. Usually, a commissioner would send investigators to collect evidence, Mr Watson said.

Despite this, the investigation was later overhauled by Mr Griffin's successor, counsel assisting were sacked, and the planned coercive hearings were abandoned.

Mr Griffin’s trip was part of the secret corruption investigation he launched in early 2019 into allegations that a high-ranking Border Force official improperly paid $39 million to Austal as part of a $570 million contract to supply eight Cape Class Patrol Boats.

The payment was made against government advice, according to evidence gathered by the Australian Commission for Law Enforcement Integrity's inquiry. The US inquiries into Austal are also examining corporate misconduct involving the firm and allegations of misleading financial disclosures to the market.

In corporate filings, Austal recently stated it was possible the US investigations into allegations of corporate misconduct could “lead to civil or criminal penalties, damages, and/or suspension or debarment from future US government contracts”.

The Age and Sydney Morning Herald revealed last month that in May 2019 Mr Griffin had authorised a series of private coercive anti-corruption hearings to quiz Austal and ABF officials about the payment. However, the strategy was rejected by his replacement, Jaala Hinchcliffe, who was appointed to lead the anti-corruption commission in February by Attorney-General Christian Porter.

The division between Mr Griffin and Ms Hinchcliffe over the Austal probe goes to the heart of the debate about the approach and effectiveness of the Australian Commission for Law Enforcement Integrity which has been the national police watchdog since 2006 and is a key pillar of the Morrison government’s proposed Commonwealth Integrity Commission.

Under the Coalition's planned integrity model, the commission will continue to investigate officials from the Australian Federal Police, border force and other policing agencies, while a second and less powerful arm will handle allegations involving political and public service corruption.

Corruption expert Mr Watson said it was very rare for a commissioner to involve themselves so fully in an investigation and fly overseas for briefings.

"If Commissioner Griffin thought this trip, along with coercive hearings by counsel assisting, were needed, it seems obvious he regarded the Austal-ABF probe with utmost seriousness and requiring the full suite of coercive powers.”

In April, after Mr Griffin retired, Ms Hinchcliffe sacked Mr Hyde and the second counsel assisting the Austal-ABF inquiry, Dianna Tang, and directed her senior investigators to use less intrusive investigative methods.

Australian Law Enforcement Integrity Commissioner Jaala Hinchcliffe in a Senate estimates committee hearing.

Private or public coercive hearings are a powerful but controversial tool used by corruption commissions. They force suspects to answer questions truthfully or risk jail, but any corruption evidence they expose, including confessions, cannot be used in later criminal prosecutions.

Sources said Attorney-General Christian Porter was disappointed at the performance of ACLEI under Mr Griffin’s reign, and wanted the corruption watchdog to focus on prosecuting more corrupt law enforcement officials rather than holding coercive hearings which generate briefings and reports but, often, few criminal charges.

The handling of the Austal-ABF probe has revealed divisions within ACLEI about the progress of the agency over the past decade. Eight former or serving officials from the agency have recently spoken to The Age and Sydney Morning Herald on the condition of anonymity. Some described ACLEI as “dysfunctional” under Mr Griffin’s five-year tenure and questioned the agency's spending on travel and handling of inquiries. However, other sources said Ms Hinchcliffe's new approach to the Austal-ABF probe suggested she was less willing to use powerful corruption-busting tools, including private and public hearings, to expose wrongdoing.

In April, Ms Hinchcliffe also cancelled Mr Griffin’s planned public coercive hearings into allegations that casino giant Crown Resorts had improper dealings with Commonwealth officials. Ms Hinchcliffe has defended the change in direction of the Austal-ABF probe and the Crown inquiry by insisting she has employed more appropriate and less intrusive investigative techniques to probe allegations and has been guided by senior investigators.

However, former Austal-ABF counsel assisting Jonathan Hyde said in a statement in October that he had a "significant difference of opinion” with Ms Hinchcliffe over ACLEI's work.