Ex-ministers Kairouz and Scott face scrutiny over grant funding

The Andrews government has ordered a review into gambling and multicultural affairs grants awarded under the tenure of fallen ministers Marlene Kairouz and Robin Scott following damning allegations at an anti-corruption hearing that public funds were misused for factional purposes.

The Independent Broad-based Anti-corruption Commission is investigating allegations of corrupt conduct involving Victorian public officers, including members of Parliament, and that taxpayer-funded grants were awarded to factional allies of dumped powerbroker Adem Somyurek, Ms Kairouz and Mr Scott and their Moderates faction.

Grants awarded under the tenure of fallen ministers Marlene Kairouz and Robin Scott are being investigated. Credit:

A senior government source confirmed Minister for Consumer Affairs, Gaming and Liquor Regulation Melissa Horne last month commissioned an independent review into the Responsible Gambling Foundation grants program to ascertain the funds were appropriately distributed.

“In November 2021, the Department of Justice and Community Safety established an independent audit into the Victorian Responsible Gambling Foundation’s grant processes,” a government spokeswoman said.

KPMG will conduct the audit into the gambling grants, and is expected to wrap it up early next year. Meanwhile, Multicultural Affairs Minister Ros Spence has asked Pricewaterhouse Coopers to investigate grants awarded to the Somali Australian Council of Victoria, which are also under IBAC scrutiny.

In response to questions to Ms Spence, a government spokesman said: “It would be inappropriate to comment while the review is ongoing.”

The wide-scale audit was confirmed as internal pressure built on Ms Kairouz and Mr Scott to quit politics at the next election as part of a factional purge of 10 sitting Labor MPs. The unrest has spilled into open warfare that has prompted crisis talks and warnings that some will quit early and trigger damaging byelections.

A source close to Ms Kairouz told The Age on Tuesday the MP would quit Parliament immediately if she lost preselection. Nominations close 10am Friday, with the party’s powerful national executive to announce its decision on Monday.

The MPs under fire have limited ability to win preselection challenges because rank-and-file ballots were suspended following an Age and 60 Minutes investigation last year that exposed Mr Somyurek’s industrial-scale branch stacking operation and prompted an IBAC investigation.

IBAC Commissioner Robert Redlich in October said the commission was examining the potential misappropriation of taxpayer-funded staff and gambling and multicultural affairs grants, including whether they were used for party-political activity and if they were provided to factional allies at the Australia Light Foundation, Cambodian Association of Victoria and the Somali Australian Council of Victoria.

The Multicultural Affairs Minister has ordered a review of grants awarded to a community group founded by Hussein Haraco (pictured), who has been accused of pocketing public funds. Credit: Chris Hopkins

The Age last year revealed $1 million in grants had been awarded to those community groups whose committees included members who Mr Somyurek claimed in secret recordings had stacked branches for him or who have links to his faction.

Mr Somyurek claimed a senior member of the Somali Australian Council of Victoria, Dr Hussein Haraco, and Hamdi Koyu, of the Australia Light Foundation, were central figures in his branch-stacking operation. Mr Koyu was also an electorate officer to Somyurek-aligned MP Kaushaliya Vaghela, while Mr Somyurek was recorded saying Dr Haraco “works” for him.

Dr Haraco, who signed dozens of fake Labor Party members to the Heidelberg ALP branch, was accused in IBAC hearings of pocketing almost $75,000 in 2019 from the Victorian Responsible Gambling Foundation Prevention Partnership Program, which Ms Kairouz was responsible for as Minister for Gaming.

The community organisation also received $100,000 in taxpayer funds after it “double-counted” expenses, according to counsel assisting Chris Carr, SC.

Mr Carr told the commission Somali Australian Council of Victoria would, for instance, receive $2000 for a computer from both the council and the Victorian government, totalling $4000. It would then show the council and the government department identical invoices and ultimately pocket $2000. Dr Haraco was scheduled to appear at IBAC in October, and then November, but has been given a medical exemption to be examined publicly.

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