United Petroleum rejects ‘extortion racket’ allegations made by ex-staff members

One of Australia’s biggest fuel retailers, United Petroleum, is suing a group of former managers who were allegedly involved in threatening and extorting money from fuel station operators.

United Petroleum is suing a number of its former staff, who allegedly extorted bribes from fuel station operators.

A group of senior managers at one of Australia’s biggest fuel retailers have been accused of standing over immigrant workers, in what has been described in court documents as an extortion racket.

United Petroleum CEO David Szymczak rejected claims made by managers that the alleged misconduct is widespread and said the company took action to hold a small number of individuals “accountable”.

United is suing three of its ex-staff and one petrol station operator across two separate court cases, claiming they bribed “commission agents” – who operate fuel stations for United – and falsely said they could be forced out if they didn’t pay up.

In one man’s defence to allegations made by United, he initially claimed “racketeering is and has been endemic to the United business”. That allegation entered the court record but was later dropped from his defence.

United Petroleum CEO David Szymczak rejected claims made by managers that the alleged misconduct is widespread.

The cases expose the seedy side of what’s colloquially called Australia’s franchise industry, although United has flagged a move away from the franchise model in favour of “commission agents” who individually negotiate commissions on fuel and pay insurance fees.

Commission agents have to hand over information about their visa status, financial position and sign confidentiality agreements to operate one of the franchises across the country, according to United’s court documents.

Rich-listers Avi Silver and Eddie Hirsch founded United in 1993. From starting with a group of small servos, business has boomed with now more than 500 petrol stations operating across Australia. The company booked a $95m profit from $7.9bn in revenue last year. 

Silver and Hirsch are estimated to be worth a combined $4.02bn, according to The Australian’s The List – Australia’s Richest 250, published earlier this year.

In one court case lodged by United last year, the fuel giant made allegations against ex-staff members including retail operations manager Abdullah Qadir, compliance lead Max Saggar, and retail operation fuel support Sarthak Oza.

United accused Mr Qadir, who was paid about $139,000 before he quit in November 2023, of threatening to boot a fuel station operator in Roma, Queensland – and originally from Vadodara, India – if he did not pay “consultancy fees”.

The fuel station operator allegedly paid Mr Qadir $25,000, which United claimed was used as a deposit for the purchase of a house in Melbourne.

Further, United claimed the Roma station operator paid Mr Qadir $81,000 between December 2021 and May 2023.

In his defence, Mr Qadir denied the allegations against him. He denied receiving $25,000 but agreed that he was paid $81,000 but not as a result of threats.

United accused Mr Saggar, who was paid about $140,000 before he was sacked in March last year, of threatening the same station operator if he failed to pay “consultancy fees” into a bank account belonging to his wife.

United alleged Mr Saggar received $28,000 from the Roma station operator.

In his defence Mr Saggar objected to these allegations, said a number of them are liable to be struck out, and claimed privilege against penalty and self-incrimination if the allegations against him constitute breaches of corporations law and the criminal code.

As well, United accused Mr Oza, who was also sacked in March last year, of receiving payments in exchange for promising a separate commission agent “an interest” in petrol stations across Victoria and Tasmania.

Avi Silver (pictured) and Eddie Hirsch founded United in 1993. Picture David Geraghty

In his defence, Mr Oza objected to the claims against him. He said he was not involved in “any activities which (created) conflict between United and commission agents”.

Mr Oza said in his defence that it was made clear to him when he started “that his job is to take orders as instructed”.

According to another case lodged by United Petroleum, commission agent Sai Chinthala was allegedly assaulted by four men at 2am in Melbourne’s outer west last year after Shashikanth Bomma – another commission agent – demanded Mr Chinthala pay him $6000 every month.

Mr Chinthala is originally from Hyderabad, India, according to corporate filings.

This was in exchange for Mr Bomma helping Mr Chinthala pass audits conducted by United, according to court documents. Mr Bomma was operating a fuel station in Cairns, according to the documents.

“On 16 February 2024 at around 2am: Chinthala drove to a location near Rockbank General Store to speak to Bomma about the employee threats and the February 2024 phone threats,” court documents allege.

“Four men, including Bomma, were sitting in a parked car at the location. The four men assaulted Chinthala.

“Bomma made further oral threats in relation to Chinthala’s personal safety, and Bomma fled the scene.”

Victoria Police was contacted for comment about the allegations. A case examining the claims in the Magistrates’ Court of Victoria has been struck out.

United’s CEO Mr Szymczak said the company reported the alleged assault to the police, and urged other parties to make a report too.

One day later, United alleged an associate of Mr Bomma turned up at the house of Mr Chinthala’s employee at 3am and demanded he stump up $3500 cash that had been allegedly taken from a fuel station.

On February 15, Mr Bomma also allegedly called the manager of Mr Chinthala’s petrol station and allegedly told him he would “break his legs” and that he “would not live to see tomorrow” if he did not get shares in a company that ran the station to sign over shares.

Between December 1 and December 31, 2023, United also alleged Mr Bomma threatened to increase the amount of rent and reduce the amount of fuel commission payable by United if his demands were not met.

Mr Bomma never had the power to help franchise operators pass audits or increase rent, according to the court documents.

Mr Bomma allegedly looked through confidential United Petroleum records to identify United service stations with recently appointed commission agents, including Mr Chinthala.

United said as a result of Mr Bomma’s alleged conduct, its business has suffered a loss and it decided to take court action.

In his defence, Mr Bomma denied making demands for $6000 per month but said he asked for $65,000 out of $100,000 he loaned Mr Chinthala to acquire a petrol station.

He also denied threatening Mr Chinthala’s staff and denied telling one of them he would “break his legs” and that he “would not live to see tomorrow”.

Mr Bomma rejected allegations he and three of his associates assaulted Mr Chinthala, and responded that “Chinthala approached Bomma with a broken glass bottle” and said he was acting in self defence.

In his first defence, Mr Bomma claimed United was aware “its senior personnel were engaging in racketeering, extorting payments from the Respondents as a condition of their enjoying favourable treatment (“protection”) as commission agents”.

The pleading was subsequently dropped due to a lack of particulars, but Mr Bomma’s defence released to The Australian by the Federal Court made the claims.

“The Respondents further aver that such racketeering is and has been endemic to the United Business,” Mr Bomma claimed in his first defence.

Responding to the allegations, Mr Szymczak said: “Allegations of wrongdoing against other personnel at United are a baseless attempt to divert blame from those responsible: themselves.

“This legal action ensures that any improper conduct is investigated, addressed and reported to police and or other authorities as is appropriate,” he said.

“United Petroleum maintains various systems and processes to monitor its business to ensure compliance to all regulations and laws, including labour laws. United does not tolerate any unlawful activity in its business.”

Mr Szymczak said United launched the legal actions to assist in the recovery of money for “anyone who has been cheated by this small group of people, and to ensure that they are held to account”.

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