Seeing and hearing is believing: How the CFMEU scandal finally landed with a thud

You often know you are on to a good story when you are inundated with tip-offs after its publication, suggesting you have just skimmed the surface. Such was the case with our Building Bad investigation.

The story exposed a scandal that many media outlets, including our own, had tried to thrust into the spotlight before: the way corruption and organised crime had infested Australia’s most powerful union, the CFMEU, along with the major state government projects that the union wielded huge control over.

Where previous attempts failed, Building Bad landed with a loud thud. Almost immediately, the Albanese government moved to place the CFMEU into administration.

Union bosses across the country have been sacked or quit. Investigations by the Fair Work Commission, administrator Mark Irving, KC, and law enforcement agencies are under way.

This week, the team behind the Building Bad series was awarded Australia’s highest journalism gong, the Gold Walkley.

But as I write this, several months after the story first broke and our team was hit with an avalanche of fresh intelligence from unionists and building industry insiders, I am struck by how much we missed in our earlier reporting, and how much more work we have yet to do.

First, an outline of how the Building Bad investigation was done and what it has achieved. It required journalism that was exhaustive and, at times, dangerous.

My colleague Ben Schneiders, who was part of the Building Bad team, has been investigating the CFMEU for more than a decade. I’ve been at it since 2008. Both of us have copped serious threats.

Late last year, we teamed up with David Marin-Guzman at The Australian Financial Review and our colleagues at 60 Minutes and Nine News.

We wanted to expose – like never before – the activities of the gangland figures who were working in an unholy alliance with the union.

In an essay on the American mafia, New York writer Adam Gopnik astutely observed how unions in his city had made a “deal with the Devil, with the result of all deals with the Devil: the Devil takes the last trick. The unions, turning to gangsters to protect themselves from strike-breakers, quickly discovered that the gangsters were just as willing to play the other side of the street for a better offer. In short order, the gangsters controlled both sides.”

We discovered this same deal was struck by some in the CFMEU with figures such as Hells Angel Sammy “The Turk” Ercan and other infamous gangland types in Victoria and NSW.

The union bosses felt these deals were justified as they would amplify the CFMEU’s industrial muscle and help push back against building companies that had separately struck their own deals with underworld figures to dampen union militancy.

So convinced was the union that it could control its gangland allies, that patched bikes, known gangsters and thugs were appointed as union delegates on some of the most important building projects in Melbourne and Sydney, including Labor’s signature Big Build projects across Victoria.

But the underworld has never cared much for union ideology and, as it was in New York before the FBI took on the mob and the unions there, it was the gangland figures wagging the dog. They had one thing in mind: making money.

Installed as the union’s gatekeepers on major projects, bikie-linked delegates demanded major contractors hire labour hire companies despite questionable records on looking after workers.

The same delegates also demanded bikie affiliated subcontractors got work, even if it meant honest companies that paid and protected their union members properly were kicked off sites. On government projects in NSW and Victoria, these activities were funded by the taxpayer.

Prior to Ercan’s jailing for violent standover activity, we obtained surveillance vision of him meeting with union officials and trying to strike a CFMEU-facilitated deal with a large building company. The deal would extend to paying Ercan and hiring subcontractors with questionable records of paying their employees.

When that company asked the union why it was being told to hire gangsters, it was told this was part of a cycle in which almost everyone would be rewarded.

The company would get industrial peace. The gangsters would cop a quid. The union would grow its industrial muscle. The only people missing out in this deal were the union members themselves.

Building Bad also went undercover, catching out on tape a gangland-aligned fixer offering to bribe union bosses to get shonky companies onto government projects.

For the audience of this masthead and 60 Minutes, hearing this offer on audio we included in our stories meant it couldn’t be simply denied.

Hearing was believing, just as seeing the footage of Ercan embracing a bikie-turned-union delegate on Collins Street underlined how deeply some in the CFMEU had fallen into the arms of outlaw motorcycle gangs.

Also vital was hearing from brave unionists, who blew the whistle on the culture of thuggery, violence and dodgy dealings that had become pervasive in the building industry and the union they had honourably served.

Two whistleblowers with the guts to go on camera deserve special mention: former delegate Robbie Cecala and CFMEU manufacturing division boss Leo Skourdoumbis.

CFMEU divisional assistant secretary Leo Skourdoumbis supports the move to appoint an independent administrator.Credit: 60 Minutes

A host of other confidential sources were also critical: unionists, police officers, building company owners and government insiders. Whistleblowers are the lifeblood of much good journalism, and they must be protected.

So why am I still of the belief that we have only begun exposing the badness? What has become clear since our story broke is that the bikies and gangland figures amassed more systemic control over parts of the industry and union than we previously recognised.

In some cases, it appears select senior union figures were in fact gangsters in disguise.

Information coming to light also suggests that state government officials in charge of overseeing taxpayer-funded projects, especially in Victoria, knew the situation was getting out of hand but failed to act.

Instead, to avoid industrial disruption and maintain the fiction that governments were delivering on their mega-projects with integrity and costs kept down, they tolerated rorting and improper practices.

This extended to allowing an enemy of good workers’ pay and conditions, the labour hire sector, to boom on state government projects.

Certain labour hire companies backed by union bosses and gangland figures have made a lot from taxpayer money. At least one owes huge amounts to its workers.

It is also clear that despite the determination of brave and principled detectives and some of their bosses, state and federal police agencies are generally reluctant to invest time and resources into stamping out the building industry’s pervasive organised crime and corruption.

The inter-agency handballing that has occurred since the story broke is disgraceful.

Despite Victoria’s anti-corruption agency IBAC being asked to investigate the scandal by the Allan government, no one from IBAC has inquired with any of the Building Bad journalists who hold information suggesting public servants failed to protect government projects from organised crime infiltration.

Perhaps IBAC’s jurisdiction doesn’t extend to the conduct we uncovered. Why then did the premier refer the matter to them in the first place?

As it stands, the CFMEU administrator Mark Irving is left to do the heavy lifting confronting building industry corruption.

That is a tall order for any barrister, no matter how distinguished, let alone one awaiting a High Court ruling on whether his administration can lawfully exercise its powers.

This is just one reason why we will stay on this story in the coming weeks and months. Our readers and the greater public deserve nothing less.