Craig Thomson found guilty of defrauding HSU

CRAIG Thomson has been found guilty of defrauding the Health Services Union during his time as national secretary.

FORMER Labor MP Craig Thomson has been found guilty of defrauding the Health Services Union during his time as national secretary.

Melbourne magistrate Charlie Rozencwajg today ruled Mr Thomson had dishonestly obtained a financial advantage by using his union credit card to pay for prostitutes.

Victoria police laid over 140 fraud and theft charges relating to Mr Thomson’s use of HSU credit cards between 2002 and 2008.

It was alleged he spent nearly $6000 of union funds on escort services, with the expenditure entered into the HSU’s accounts as “entertainment”, meetings and teleconferencing expenses, and misappropriated over $20,000 for other personal purposes.

Mr Rozencwajg said evidence before the court showed that union funds, including union-issued credit cards, should be used only for the benefit of union members and Mr Thomson would have known this as national secretary.

He said it would be “an affront to common sense” to believe spending union money on escort services fell within any “grey area”.

Mr Rozencwajg said he had no doubt that Mr Thomson was fully aware he did not have authority to use union credit cards to pay for escorts.

He said a memo from May 7, 2005, in which Mr Thomson claimed $770 spent on escort services as a “dinner function” in Sydney was a clear example of dishonesty.

“The above meeting has been claimed as a business expense,” the memo said, with a handwritten note of “Internat Immobiliare” added to the page.

The court heard International Immobiliare is the trading name of Boardroom Escorts in Sydney and Mr Thomson ordered an escort called Alina from that service on 6 May 2005, with $770 charged for one hour of sexual services.

Mr Rozencwajg dismissed 13 charges relating to Mr Thomson charging pornographic movies to his hotel room, paid for by the HSU, as he said he could not be satisfied Mr Thomson had been dishonest about his conduct.

The case heard testimony from a former prostitute who said Mr Thomson paid her for sex on several occasions, as well as HSU officials who said claiming escort services, adult movies and private travel on the union credit cards was not acceptable though there was no written policy.

Records from Sydney brothel Tiffany’s Girls have shown a job sheet from its ‘Red Turbo Spa Room’ matched charges on Mr Thomson’s card, with hotel rooms where he stayed also matching escort agency records.

Mr Thomson, who lost his seat after standing as an independent in last year’ election, pleaded not guilty to the charges.

His legal team argued the rules of the HSU did not define the boundaries of work-related expenditure, and because the expenses had been approved and paid, no party had been actually defrauded.

Mr Thomson’s barrister Greg James QC did not challenge the evidence around how the expenditure was incurred, or what it was spent on, but claimed several of the charges were ambiguously drafted and should be thrown out.

Mr Rozencwajg has previously questioned the prosecution’s handling of the case and the nature of the charges, saying ‘’there are far more simple charges that could have been laid here but have not been brought’’.

Mr Thomson still faces a civil case launched in the Federal Court by the Fair Work Commission, but has sought mediation which began last year.

Mr Thomson was released on bail to appear for sentencing submissions next month, and agreed not to leave Australia in the meantime.

He refused to comment as he left the court, with relatives of HSU official Marco Bolano shouting “liar!” at him.

Mr Thomson used parliamentary privilege to accuse Mr Bolano of threatening to “set me up with a bunch of hookers”.