NBN scout silent on inquiry

THE process behind the hiring of the top executive at the NBN apparently failed to disclose controversial information.

THE recruitment process behind the hiring of the top executive at the National Broadband Network involved "thorough background checks" but apparently failed to disclose controversial information offered by a simple internet search.

The federal government yesterday said Mike Quigley had been appointed NBN Co chief executive after its engagement of multinational recruitment firm Egon Zehnder.

"That recruitment process involved thorough background checks on all candidates, including police and credit record checks, as well as personal references," a spokeswoman said.

This week the government revealed that when it appointed Mr Quigley and NBN Co chief financial officer Jean-Pascal Beaufret in mid-2009 it was unaware of an ongoing US government corruption investigation into French telco giant Alcatel-Lucent, where both men had held senior positions.

Egon Zehnder Australia managing partner Neil Waters refused to comment on whether the group was aware of the investigation into Alcatel-Lucent before Mr Quigley was appointed, only confirming the company did "background checks".

At the time of Mr Quigley's appointment to NBN Co, the US Securities and Exchange Commission was several years into a five-year investigation into bribery allegations concerning Alcatel, which resulted in the telco being fined $137 million for paying bribes to officials in Latin America and Asia.

Mr Quigley, who had spent 36 years at Alcatel, was the company's president and chief operating officer in 2005 and 2006. Mr Beaufret was chief financial officer of Alcatel between 2001 and 2007.

Both Mr Quigley and Mr Beaufret said they had no involvement in the matters subject to the SEC's complaints and were not interviewed in relation to the SEC investigation.

"The actions of a number of individual Alcatel-Lucent employees detailed in the SEC's statement fell outside the accountability and jurisdiction of both Mr Quigley and Mr Beaufret," a spokeswoman for NBN Co said. The government would not confirm whether anybody outside NBN Co had conducted background checks on Mr Beaufret.

According to recruitment experts, agents are paid fees equivalent to between 28 per cent and one-third of the salary of a position they fill. Mr Quigley was paid $1.86m for the 2009-10 year, indicating a recruitment finder's fee of up to $620,000.