High Court appeal ‘stymying’ push to weed out CFMEU corruption

The task of weeding out corruption in the construction union has been stymied by a High Court challenge that threatens to reinstate former union bosses thrown out by the federal government, the CFMEU’s administrator has told parliament.

In the report tabled on Tuesday during Senate estimates, CFMEU administrator Mark Irving describes how his regime has been undermined by an unresolved High Court challenge at the same time as union staff told an investigating barrister that “underworld” figures such as Mick Gatto “came with the furniture” in the troubled industry.

CFMEU administrator Mark Irving, KC, in his chambers.Credit: Joe Armao

The administration was created in August last year in response to the Building Bad investigation by this masthead, The Australian Financial Review and 60 Minutes. Ousted members of the union brought a High Court challenge against the administration in September, led by barrister Bret Walker, SC.

But Irving said it had proved challenging to get union members to speak out about what they had witnessed because they feared reprisals if former leaders won their court cases and regained control.

“Uncertainty about whether the former leadership is returning to power has, in some cases, impeded the administration in obtaining full and frank disclosures from complainants,” Irving’s report said.

“In circumstances where the previous leadership could be reinstated as the result of the High Court proceedings, the engagement of the best new staff, reallocating resources and performing the necessary work has been stymied.”

Reports from barristers Geoffrey Watson and Chris Kummerow detailing union violence and threats, which were released earlier this month, were also tabled at Senate estimates.

“I was told about specific incidents in which union people had been severely bashed or subjected to threats of violence or death, but no police referral was made,” Watson wrote in his report.

“From my investigation, it appeared to me that, in this cycle of intimidation and violence, the CFMEU had lost control.”

Watson added that several union officials “described Gatto as a friend”.

“Many of the officials I interviewed said that they had seen or met with Faruk Orman and Mick Gatto at the CFMEU offices on Elizabeth Street. I was told that there were occasions where EBA paperwork was brought to Mick Gatto while he met with senior officials,” Watson wrote.

He said one senior official told him that Gatto “came with the furniture of the job”.

Watson was scathing of moves by the Victorian branch of the union to expel delegates who were members of outlaw bikie gangs, describing the investigations to get rid of “undesirables” before the union entered administration, as superficial and ineffective.

The report says Watson was told that “almost all of the people” on the union’s list of outlaw gang delegates were still employed on the sites, but had switched from being paid union delegates to working directly for the employers. “I understood that the same men remained on the same sites with, more or less, the same authority.”

One official told Watson that a “whole heap of bosses employ standover people” and agreed that the Victorian branch also did this. “Of course we are. We are trying to get people paid and get them home safely,” the official was quoted as saying.

A separate report by Watson, also handed to parliament, concluded former NSW secretary of the CFMEU, Darren Greenfield, should be investigated for criminal charges after more than $3 million of union members’ money was transferred to pay legal fees for him and his son.

The NSW branch of the union transferred $3.15 million to law firm McGirr and Associates in July 2024, two days after the Albanese government forced the CFMEU into administration.

“It is common ground that the $3,150,969.50 was intended to cover the further legal expenses
being incurred by the secretary of the CFMEU Construction and General Division NSW Divisional
Branch, Darren Greenfield, and his son, the assistant secretary, Michael Greenfield,” Watson wrote.

A second sum of $500,000 was put aside to defend any proceedings against the Fair Work Commission.

“It is remarkable that, at this time of apparent crisis, the Greenfields were receiving this kind of specifically preferential treatment,” Watson wrote.

“Darren Greenfield knew that important funds were being paid for his benefit, when they could have been used elsewhere for the benefit of the members.”

Further, Watson’s report claimed McGirr provided an estimate for legal costs that was “grossly excessive”, “obviously hopeless” and “grossly exaggerated” to his own benefit and that of the Greenfields.

In response, McGirr defended his reputation and dismissed Watson’s findings.

“Suggestions that I hindered any investigation is abhorrent and I stand by my reputation within the legal fraternity, and the report was like a creative writing piece,” he told this masthead.

“None of the rates that we were charging were excessive, and the particular document that Watson did not release evidences all of that in writing including in bold that the money was an estimate only, and any money not spent would be returned to their lawful owner.”

In a submission from McGirr seen by this masthead, he outlines rates for senior counsel, two junior counsel and solicitors, which amount to $3 million in fees.

The Greenfields and former NSW branch director Rita Mallia also face potential fines of more than $150,000 each for failing to co-operate with the investigation.

A spokeswoman for the CFMEU administration declined to comment.

Workplace Relations Minister Murray Watt said: “The administrator and his team continue to make good progress in cleaning up the CFMEU and ensuring its members are well represented.”

Cut through the noise of federal politics with news, views and expert analysis. Subscribers can sign up to our weekly Inside Politics newsletter.