Financial watchdog takes CFMEU boss Michael O’Connor to court over industry fund First Super role

The financial watchdog is taking Michael O’Connor to court amid a bid to kick him off the board of industry fund First Super.

The financial watchdog is suing CFMEU boss Michael O’Connor amid a bid to kick him off the board of industry fund First Super.

The Australian Prudential Regulation Authority said in a statement on Friday morning the court action was kicked off after an investigation into a contract between First Super and the under-fire Construction Forestry and Maritime Employees Union for member and employer services.

The contract concluded in 2023.

APRA claimed Mr O’Connor breached director rules in the Superannuation Industry (Supervision) Act including obligations to act honestly, act in the best financial interests of beneficiaries and to prioritise the interests of beneficiaries when in a position of conflict.

Mr O’Connor allegedly approved the appointment of a CFMEU employee to perform a full-time role under the contract, APRA claimed.

“Mr O’Connor … was aware that the employee continued to undertake a significant portion of work for the CFMEU,” the statement said.

It further alleged he directed or approved the employee carrying out the work for the CFMEU and was aware First Super was paying fees under the contract, which included an amount covering the full-time wage of the employee.

As well, APRA alleged Mr O’Connor did not inform or seek approval from First Super for the employee to carry out work for the CFMEU or seek to reduce the fees payable by First Super under the contract.

“Mr O’Connor was involved in the negotiation of the extension of the MESC contract on behalf of the CFMEU in circumstances where he was in a position of conflict,” the statement read.

APRA is seeking declarations and penalties against Mr O’Connor in relation to the alleged contraventions. APRA is also seeking orders disqualifying Mr O’Connor from acting as a responsible officer of any corporate trustee or superannuation entity for a period determined by the court.

First Super, which has links with timber and paper industries, released a statement about the court action on Friday afternoon.

“We have been informed that APRA has initiated court proceedings against Mr Michael O’Connor,” a First Super statement read.

“As this matter is before the Federal Court, it would not be proper for us to offer any further comment on these proceedings or the subject matter of these proceedings.”