Alan
Jones interviews Michael Smith
As a matter of public importance, we provide here the transcript of Alan Jones’ 30-minute interview on Sydney Radio 2GB with Michael Smith on the four-year relationship of Julia Gillard with Bruce Wilson, who misappropriated union funds.
Julia Gillard, Bruce Wilson and Slater
& Gordon
Alan Jones 2GB Talk Back Radio, 20
July, 2012
Transcript by Tony Thomas
Alan Jones: Look
I have argued for months now that there must be more to this Thomson affair
than we know. Why has it taken three years to investigate Thomson, which is
basically about the misappropriating of union funds. Let’s forget for the
moment that they might have been used for travel or brothels or whatever; the
fact is that there are 1.8 million union members in the country, they pay about
10 bucks a week minimum in union fees, that is $18m a week or nearly a billion
a year, so let’s be honest, who is going to miss a couple of hundred thousand.
This is just a running tap. If you have 72 Labor members in the House of
Representatives and 32 are former union officials, how many of them might have
done what Thomson did. If you have 23 out of 32 Labor senators who are former
union officials, how many of them might not pass the kind of scrutiny being
applied to Thomson?
Now one of the most trenchant supporters of Thomson
has been Julia Gillard. The presumption of innocence must apply, she said. Mind
you it didn’t apply when they were attacking the [then] Governor-General
Archbishop Hollingsworth; there was no evidence of anything against
Hollingsworth, they didn’t care then about the presumption of innocence. Is
there more to this than meets the eye, you have to ask. The most powerful union
in this nation is the Australian Workers Union. In 1992 Bruce Wilson was a
senior official with the union in WA. He was married with young children. He
had a reputation for militant behavior. He was known to act outside the law.
He met Julia Gillard in the early 1990s. She was a
partner in the law firm Slater & Gordon. She lived in Melbourne. She
started a romantic relationship with him. On April 22, 1992, Julia wrote out an
application to the WA Corporate Affairs Commissioner to register a new legal
entity. It was an incorporated association, the sort of entity a local youth
club might set up for a hockey team or a kids’ footie club. It allows the
association to set up bank accounts, appoint a treasurer etc. BHP, I might add,
doesn’t run its business through incorporated associations. Optus doesn’t
operate through such associations. If the local manager of the NSW branch of
Telstra went to a lawyer mate and asked the lawyer to set up the Telstra NSW
Accounts Receivable Association and started to pay Telstra bills into the
account, he would be in the dock along with the lawyer. Unions don’t operate
their activities either through associations.A union is a registered organisation under industrial relations laws. Julia, and as I understand it her handwriting is on it, wrote out the application to register the AWU Workplace Reform Association way back in April 1992. According to a report by Detective Sergeant McAlpine of the WA Fraud Squad, who was, when this matter was before the Australian Industrial Relations Court because that is where it was registered, in WA, and investigated this quote “fraud” unquote, only two people in the AWU knew anything about the existence of this association. Wilson and his accomplice this bloke Ralph Blewitt.
McAlpine wrote, aside from Wilson and Blewitt, no
other person in the AWU had any knowledge of the existence of this
organization. Its formation or incorporation had not been authorized by the
AWU, despite the fact that one of the objects of this new association was to
promote the development of unions.
Detective McAlpine described how Wilson would visit
large building companies and have them write out cheques to the AWU Workplace
Reform Association and apparently at least $540,000 went into the accounts.
McAlpine of the Fraud Squad wrote, quote: In addition to incorporating this new
association and conducting negotiations with Thiess Contractors without the
knowledge of the AWU, Blewitt and Wilson obtained a private letterbox at the
Northbridge [WA] Post Office to which all mail for the AWU Workplace Reform
Association was addressed. The AWU, says McAlpine, was unaware of its
existence. So Julia Gillard, a partner in the law firm is in a romantic
relationship with this bloke Bruce Wilson. He asks her to set up a new legal
entity for the union. She asks for no resolution of the union, no minutes of
the union meetings, no national approval for the new legal entity. She doesn’t
point out to her boyfriend that the rules of the union prohibit the establishment
of a new entity like this association.
If the new association ran the tea club or a
Tattslotto account that might be one thing , but this little cash cow did much
more than that. As I understand it, a few months after it was set up, Wilson moved
to Melbourne.
On February 13 1993 he set up a contract to buy a
house in Fitzroy. He paid $23,000 in deposit. A few days earlier he signed a
cheque from the association’s bank account for $25,000. Bear in mind that Julia
says she knew nothing about why her boyfriend needed this new association for
union business.
She said she was young and naïve, and she was,
quote, terribly distressed when she found out what he had been up to. According
to her, he was concealing it all from her. He must have been very good (at
that) because he chose her legal firm Slater & Gordon to do the
conveyancing on the purchase of the house. Slater & Gordon, the firm in
which Julia was a partner, wrote a letter to say that the amount of $67,722.30
would be required from Wilson and Blewitt to complete the sale.
The law firm said it needed a bank cheque. Well,
the firm must have trusted Wilson because there was no bank cheque, Wilson
signed a cheque from the very association that Julia Gillard had set up just a
few months before.
One of the rules of the association written to
satisfy the WA Corporate Affairs Commissioner, was, quote: “the property and
income of the Association must be applied solely in accordance with the objects
of the Association. No part of that property or income may be paid or otherwise
distributed directly or indirectly to members unquote.” Well, Wilson and
Blewitt at that stage still didn’t have quite enough money in the account to
buy the house. They needed an extra $150,000. Who lent them the money? Slater &
Gordon, Julia Gillard’s law firm. It gave them as I understand it a mortgage
for $150,000 and the firm did the conveyancing for free. This bloke Wilson
obviously was an important client. Julia Gillard was in a romantic relationship
with him for four years, until he was caught out, as I understand it, in
similar frauds using bank accounts in Melbourne. He was sprung in August 1995.
Wilson had by then renovated the house he bought
with the money he had taken out of the union in 1993. He was dealing with many builders.
Julia Gillard owned a house too. It was renovated during that time. And as the
bank statements point out, huge amounts of cash came out of the AWU Workplace
Reform Association, cash cheques for $50,000, $8,000, $5000, every few days. It
does make Craig Thomson look a bit of a miser. We don’t know where the cash
went. Julia Gillard later produced a handwritten receipt from a builder, to say
that she had paid for the renovation to her own home herself. No-one yet knows
why $18,000 was paid directly to a women’s fashion boutique in Melbourne, Town
Mode.
In August 1995 it all came crashing down. Wilson
left the union. The union paid back tens of thousands of dollars to various
construction companies. In October 1995 it was becoming very public. Wilson was
gone. The matter had been raised in the Victorian Parliament. It had been
reported that Julia Gillard was being sacked from her job with Slater &
Gordon. Julia Gillard was interviewed by The Australian on October 12,
1995. She told the reporter Ebru Yaman, “I am still a partner with Slater &
Gordon, and I have no intention of going anywhere.” Soon after that story ran,
she was gone, her desk was cleaned out. She has never practiced law since. She
was without a job, as I understand it, for six months, until Joan Kirner
arranged a role for her as chief of staff with John Brumby. Wilson was never
charged. He and his accomplice Blewitt sold the house, and the union received
not one cent of its money. A couple of people lost their jobs after trying to
report this story. Michael Smith is one of them.
Michael Smith was a policeman in Victoria. He
served in the busy Collingwood and Port Melbourne stations. He was in the
regular army for eight years. He has been a successful businessman, CEO of a
national mobile communications carrier in Jakarta Indonesia, the head of
Telstra’s global satellite business. He was chairman of the board of the
Queensland University Business School and director of the board of the
Queensland Symphony Orchestra and actually ran the orchestra as CEO for three
years. He was offered a job on Radio 4BC Brisbane, in 2008 and was very
successful at that. He moved home to Sydney and last year he hosted Radio 2UE’s
afternoon show, and he was the top rating day-time host on that station, but he
lost his job over this matter.
Michael, you have tried to raise this matter and
lost your job, how powerful have been the forces seeking not to have this
matter discussed?
Michael Smith:
Immensely. It has been done through back channels, never through a direct legal
approach. I know that on the morning that I was going to broadcast this matter,
Julia Gillard herself phoned the CEO of News Ltd, John Hartigan and made three
demands of him
1.
Hartigan withdraw a column that Glenn
Milne had published in The Australian that day
2.
That The Australian apologise
for that
3.
That News Ltd give her an undertaking
that it would never again report in any way on websites or in its newspapers on
this matter.
Jones:
Why would anyone agree to those sorts of demands?
Smith:
You would have to be present in the conversation with Hartigan. What I was told
by a very senior News Ltd executive is that threats were made by the Prime
Minister to harm the interests of News Ltd if it didn’t comply with her direct
demands of it. In my case, I worked for a radio station owned by Fairfax. Ten
minutes before I was due to go to air after having recorded an interview with
the former head of the union, Bob Kernohan, after having that exhaustively
checked legally over the weekend and producing the various documents that my
external defamation lawyer that Fairfax had engaged, required to substantiate
the truth of the things we were saying. We had been right through that process,
2UE was promoting the fact that this interview was going to go to air, so it
had been approved by 2UE management for broadcast. Ten minutes before I was
going to air, a senior executive in Fairfax from Melbourne phoned and said you
are not to broadcast it. And then it went on and on for a week or so.
Ultimately they would not permit it to be broadcast or spoken about in any
fashion. And you have to wonder what influence was brought to bear.
Jones:
This union fellow Wilson, surely he can be located? Has he changed his name or
appearance?
Smith:
I have spoken with him, I know where he is, what job, what city.
Jones:
He probably can’t speak without incriminating himself?
Smith:
Absolutely right. If he is to speak, the man seeks protection and immunity.
There are others far more senior than him who are involved in this matter. It
goes to the heart of unionism and the power of unionism.
Jones:
And the Thomson affair?
Smith:
It is identical, Alan. Michael Williamson the HSU guy, who is in the slot
himself. Williamson was to Craig Thomson exactly as another very senior union
man, Bill Ludwig, was to this bloke Wilson.
The best way I can illustrate it is this: If you
leave home to go to work, lock the house up and you left $5000 on the kitchen
table, you come home and it is gone, you call police, “My money is stolen!”.
The police say they will investigate for you. They find the fingerprints, they
find the crook. Here he is, here is the man who stole it. You look at the
crook. It is your cousin. You go, “Oh shit!”
The police say they will charge him if you give
them a statement. “I can’t make that statement, I can’t do it to my cousin”. If
it is your money and he is your cousin. That’s stiff for you, that is your
decision. But if you are a union official, it is not your money, it is the
members’ money. You can’t say if you are Williamson, “Look, Craig Thomson has
used all this money etc” but say to the police. “I am not going to give you a
statement”. That is exactly what happened with Wilson. The union chiefs would
not give a statement to police that stated we owned this money. If you go to
the Police Academy you learn the point of proof for theft, dishonesty, you
appropriate property belonging to another with intention permanently to deprive
the other of it. If you don’t have a statement from the owner of the money,
there is no charge and no offence.
Jones:
The recently appointed CEO of News Ltd Kim Williams said at the SA Press Club
last week that the public’s right to know is sacrosanct. Without apportioning
innocence or guilt to the Prime Minister, does the public have a right to know
what went on in this matter?
Smith:
Absolutely. To have confidence in our system we have a right to know. You look
at the face of someone in their 50s or 60s who has been subjected to terrible
abuse as a child. If the offender is brought to the dock even a generation
later, it gives us confidence in the fact that this is a just place, a just
community.
Jones:
When the News Ltd stuff happened in Britain, phone hacking, Julia Gillard said
that news organisations had serious questions to answer. From your understanding
of this issue, does Julia Gillard have questions to answer, without in any way
suggesting she is innocent or guilty?
Smith:
Absolutely. I can’t make a judgement about innocence or guilt. But, as a former
policeman, I can look at the facts put in front of me and work out in my own
head whether there is a prima facie case to answer.
Jones:
Well, Robert McClelland is her former Attorney General. He, not me, has raised
this matter in Federal Parliament. Was not he solicitor at the Sydney law firm
Turner Freeman acting for the AWU union officials at the time, Bill Ludwig and
Ian Cambridge?
Smith:
Absolutely. It was Ian Cambridge, a former union official in AWU, who was the
first union official in this country to call for a Royal Commission into his
own organization. The former Attorney General Rob McClelland prepared the
paperwork for that. He asked for the Royal Commission, I can see why.
Jones:
To trace the misappropriated funds?
Smith:
Absolutely, and to look at the role of senior union officials who can say to
police when they knock on the door saying here is all the evidence, such as
with Thomson, for example, and the brothels and the cash and the ATMs, how can
it be just that union officials can say to police, no I will not give you a
statement?
Jones:
If Cambridge called for a Royal Commission then, Julia Gillard has subsequently
appointed him to Fair Work Australia?
Smith: You
have to look at a number of appointments, including the recent appointment of a
federal court judge who was a partner in the same law firm with her, in the
same IR department. I would be looking very closely at a number of these
appointments if I was conducting the Royal Commission of Inquiry into this
matter.
Jones:
Cambridge has been calling on the one hand for a Royal Commission but then is
appointed (to FWA). He was the author of the affidavit when McClelland was the
solicitor. Cambridge is now in the union controlled Fair Work Australia, which
has delayed the investigation into Thomson and, as I understand it, he has not pursued
the Wilson-Gillard matter since.
Smith:
That is true. He swore an affidavit with penalty of perjury if falsely sworn.
You read it; read what he said about Slater & Gordon, and its role and Ms
Gillard was a partner who was involved in this position where she had a
conflict of interest having a sexual relationship with the man who headed up
her client, the AWU, that was undisclosed to her partners. The Law Council
would have a view about the appropriateness of that.
Jones:
Did she, as a lawyer, set up accounts into which extorted funds were diverted?
This union heavy was going around saying: I want this money, 25 thousand from
you and 30 thousand from you in order to get work done. This was 20 years ago,
and that money was shoved into another account the AWU would not know about.
Did she set up those accounts?
Smith:
I know that her handwriting is present. I have had that analysed by the
country’s pre-eminent forensic handwriting analyst, Paul Westwood. He is the
same guy who helped me out on the Craig Thomson matter, who analysed the
hand-writing on the credit card chits, the signature.
I am a layman. I can look at her handwriting, I
have a copy here and the handwriting on that form. It is identical. But the
forensic analyst tells me it is in all likelihood, balance of probabilities,
written by the same person, by her.
Jones:
The accounts set up that she as a lawyer opened at the direction of Wilson and
Blewitt have been described by an AWU executive as unauthorized, invalid,
irregular and used for quote, possibly illegal purposes. There were 13 of them.
Smith:
Yes, a large number of accounts were set up. Wilson was given the flick from
the AWU when the accounts that were established in Melbourne were discovered
and he was allowed to leave the union, and in fact got redundancy payments. The
money was paid back to the organisations that had paid the money into those
accounts, in Melbourne. Julia Gillard was questioned in Melbourne and said: I
have done nothing wrong. At that point the account she had set up in 1992 in
Perth had not been discovered. It was discovered later, after he had left the
union and after she had made the public protestation that she did nothing
wrong. She had a duty as a lawyer acting for the AWU, upon a report to her law
firm that fraud had been discovered, she had a duty to assist her client to
find the location of any further monies that might be owing to it, including
her knowledge, the fact that a cheque drawn on the association she had set up,
had been used to buy a house for a person, not for the union, and she said
nothing.
Jones:
This was in March 1993. Slater & Gordon were involved in the purchase of
this property at 85 Kerr St, Fitzroy, and money that Thiess Contractors paid
was used to pay for the property. Wilson’s signature was on the cheque.
Smith:
Absolutely.
Jones:
Thiess was apparently not aware it was paying money into a fraudulent account.
The house was sold in 1996, proceeds of the sale went to Wilson and Blewitt.
Smith:
Correct
Jones:
That was when Cambridge, the then national secretary of the AWU, swore an
affidavit that he was unable to understand how Slater & Gordon who were
then acting for the Victorian branch of the union, could have permitted use of
the funds, which were obviously taken from the union in the purchase of private
property of this nature, without seeking and obtaining proper authority from
the union.
Smith:
Absolutely. And when his Melbourne frauds were discovered in 1995 she said
nothing about the existence of the Perth accounts; she said nothing about
acting for him and his offsider for purchase of the house in Melbourne, an
asset the union could then have realized to try to get its money back. And
weeks after that she had left the law firm Slater & Gordon and never again
practiced law.
Jones:
So basically this business, this fund came into existence as a result of an
application to the WA Corporate Affairs Commissioner…
Smith:
Yes
Jones:
… to register an incorporated association and the AWU knew nothing about it..
Smith:
Absolutely right
Jones:
… and money was being funneled out into the bank accounts of that.
Smith:
Correct.
Jones:
And Cambridge became aware of all this and swore this affidavit.
Smith:
He hit the roof mate, as did Bob Kernohan, or would any just person in looking
at this. That is why he was so active calling for a Royal Commission into his
own union. He wrote to the then chief industrial relations Federal Minister
Laurie Brereton: Look mate, the only way to get to the heart of this, who was
involved, is by having a Royal Commission
Jones:
McClelland who was sacked, the dismissed Attorney-General, he was acting for
Ludwig and Cambridge, he encouraged both of them, as I understand it, to submit
affidavits to the NSW Industrial Relations Court.
Smith:
Well, Con Sciacca was acting for Ludwig, up in Brisbane. It is factual that
McClelland was acting for Cambridge. And McClelland prepared the papers and saw
the documents and could see clearly what had gone on.
Jones:
He was in the Federal Parliament.
Smith:
He said in the House of Representatives, “What I saw then in the mid-1990s,
when I was one side as lawyer and Julia Gillard was on the other side as
lawyer, has colored my view about unions.” When I look at Thomson and the HSU
it is eerily similar. I have spoken with Rob about this. The Thomson matter
could not have happened if the call for reform which McClelland is now making,
had been heeded.
Jones:
He wants laws tightened as they apply to union accountability?
Smith:
Absolutely. If you are a shareholder of BHP and the boss there is ripping off
money for brothels and pulling out large amounts of cash, you as a shareholder
can go to the Securities Commission and they will look into it.
If you are a HSU worker you put on your purple
dress, get up at 5.30 am every morning and work in the furnace-like laundry of
the hospital, and you see Thomson ripping off money for brothels, you have no
means to bring that to the attention of the authorities.
Jones:
Ian Cambridge who swore the affidavit and had called for a Royal Commission
into his own union, was appointed by Julia Gillard to the union-controlled Fair
Work Australia, which has taken an eternity and has still not fully reported on
Thomson.
Smith:
There are number of appointments I would suggest require some scrutiny.
Jones:
The Industrial Court at the time ordered Wilson to repay some excessive
redundancy pay he awarded himself?
Smith:
Yes.
Jones:
What happened to all the other money? Was it spent like Thomson on credit
cards, and massage parlours.
Smith:
I went through Thomson’s bank statements chapter and verse, and look, as a
copper I saw that a lot of frauds started small, 100 or 200 bucks, and a bloke
says, hey I’m getting away with this, and it becomes big. It’s the same with
the Wilson matter. Except in the olden days there were no ATMs, it is cheques.
They are small now, then huge. This is great, I will buy a house, away we go.
At the time when it was discovered and when Cambridge brought his action so
vigorously before the court, the union went back to court with an application
for more time to find where its assets were and the union, headed by Ludwig,
allowed that to lapse. No-one did anything. And now Howes, boss of the union,
tells the ACTU Congress that we must run to ground all malfeasance, all crooks,
they must be found and put in gaol, and every cent of members’ money recovered.
Mate he has the files. He could commence today an investigation and he could
heed the call by McLelland to go and find the assets. He could find (those)
assets, and he has not.
Jones:
As a lawyer with Slater & Gordon, Julia Gillard wrote out the application
to register the AWU Reform Association and yet Slater & Gordon were
representing that union and lawyers for Slater & Gordon would automatically
know that unions don’t operate their activities through associations of this
kind.
Smith:
That association was a sham. I have independently spoken to various defamation
lawyers about that statement. I am absolutely confident in the truth of it. It
was established to do six things and did none of them. It advised the Corporate
Affairs Commissioner that if he registered the association in WA, it would not
do one thing — distribute money to its members. But all the six things it was
set up to do, it did none of them, and it did the one thing it promised not to
do, give money to the blokes who set it up. No-one else in the union knew about
it. It set up a private post box office. It is inconceivable that bills that
could have been generated by the law firm and forwarded to the union’s accounts
payable for advice and work setting up this association, it is inconceivable
that (the bills) could have been paid if it was fairly and properly conducted.
Jones:
Is this the reason why the government has been very, very slow to act on
Thomson and very, very silent in offering no criticism about him?
Smith:
The Labor Party is so closely affiliated with the union movement. It is so full
of people who owe their job to the support of an individual union at the Labor
Congress. The AWU is the most powerful of them.
Jones:
That is Bill Shorten’s union.
Smith:
Have a think about this one point. On the night that Rudd got the knife, who
was it went on TV on ABC LateLine to announce why Rudd was going, that he would
be replaced by Julia Gillard. It was Paul Howes, head of the AWU.
Julia is from the far left, socialist left. Bill
Ludwig, national president of the AWU, is of the far right. It is just
noteworthy that she stood by him at the AWU’s National Congress and said, “I am
proud to call Bill Ludwig my friend.”
Well Ms Gillard, that doesn’t surprise me in the
slightest.
Jones:
A final comment: Julia has said previously when questioned that she was young
and naïve, and she was terribly distressed when she found out what the
boyfriend Wilson had been up to. Would that be Wilson’s account of things?
Smith:
(laughs loudly), Alan, no.
Jones:
According to her, Wilson was concealing it all from her.
Smith:
Yeah (laughs). Bruce Wilson lives in a coastal town, he goes to work in
a very old car, he is working in the kitchen at a registered club, he works
shifts there cooking meals. He looks at Tim Mathieson and Julia Gillard getting
on the plane and thinks to himself about what he knows. What if he was
approached by the authorities? What would he have to say under oath? His
account is very different from hers. And look Alan, you just add this up, the
weight of Cambridge’s affidavit, what Ludwig has to say, what his offsider
Blewitt has to say, and all the documents, all the bank statements, all the
handwriting analyses, put that on one side of the scale, on the other side of
the scale put this statement: “I did nothing wrong, I was young and naïve.”
Jones:
OK, that is Mike Smith, actually when he last tried to raise these matters he
lost his job. It is very strange, the world we inhabit.
Smith:
Will you please indulge me, the hero of this affair is a man called Robert
Kernohan, who was offered inducements, offered seats in Parliament, who was
bashed senseless in the street, who had bullets mailed to his home address.
That man has suffered immensely and has never once wavered in his pursuit of
the return of his members’ money, and he Rob Kernohan is a hero.
Jones:
There we are. The public has to work that out for themselves. But nonetheless
the people are asking questions about how this Thomson matter still remains
unresolved. The genesis of that failure to resolve may lie in matters that
occurred many, many years ago.
Julia Gillard, Bruce Wilson and Slater
& Gordon
Alan Jones 2GB Talk Back Radio, 20
July, 2012
Transcript by Tony Thomas
Alan Jones: Look
I have argued for months now that there must be more to this Thomson affair
than we know. Why has it taken three years to investigate Thomson, which is
basically about the misappropriating of union funds. Let’s forget for the
moment that they might have been used for travel or brothels or whatever; the
fact is that there are 1.8 million union members in the country, they pay about
10 bucks a week minimum in union fees, that is $18m a week or nearly a billion
a year, so let’s be honest, who is going to miss a couple of hundred thousand.
This is just a running tap. If you have 72 Labor members in the House of
Representatives and 32 are former union officials, how many of them might have
done what Thomson did. If you have 23 out of 32 Labor senators who are former
union officials, how many of them might not pass the kind of scrutiny being
applied to Thomson?
Now one of the most trenchant supporters of Thomson
has been Julia Gillard. The presumption of innocence must apply, she said. Mind
you it didn’t apply when they were attacking the [then] Governor-General
Archbishop Hollingsworth; there was no evidence of anything against
Hollingsworth, they didn’t care then about the presumption of innocence. Is
there more to this than meets the eye, you have to ask. The most powerful union
in this nation is the Australian Workers Union. In 1992 Bruce Wilson was a
senior official with the union in WA. He was married with young children. He
had a reputation for militant behavior. He was known to act outside the law.
He met Julia Gillard in the early 1990s. She was a
partner in the law firm Slater & Gordon. She lived in Melbourne. She
started a romantic relationship with him. On April 22, 1992, Julia wrote out an
application to the WA Corporate Affairs Commissioner to register a new legal
entity. It was an incorporated association, the sort of entity a local youth
club might set up for a hockey team or a kids’ footie club. It allows the
association to set up bank accounts, appoint a treasurer etc. BHP, I might add,
doesn’t run its business through incorporated associations. Optus doesn’t
operate through such associations. If the local manager of the NSW branch of
Telstra went to a lawyer mate and asked the lawyer to set up the Telstra NSW
Accounts Receivable Association and started to pay Telstra bills into the
account, he would be in the dock along with the lawyer. Unions don’t operate
their activities either through associations.
A union is a registered organisation under
industrial relations laws. Julia, and as I understand it her handwriting is on
it, wrote out the application to register the AWU Workplace Reform Association
way back in April 1992. According to a report by Detective Sergeant McAlpine of
the WA Fraud Squad, who was, when this matter was before the Australian
Industrial Relations Court because that is where it was registered, in WA, and
investigated this quote “fraud” unquote, only two people in the AWU knew
anything about the existence of this association. Wilson and his accomplice
this bloke Ralph Blewitt.
McAlpine wrote, aside from Wilson and Blewitt, no
other person in the AWU had any knowledge of the existence of this
organization. Its formation or incorporation had not been authorized by the
AWU, despite the fact that one of the objects of this new association was to
promote the development of unions.
Detective McAlpine described how Wilson would visit
large building companies and have them write out cheques to the AWU Workplace
Reform Association and apparently at least $540,000 went into the accounts.
McAlpine of the Fraud Squad wrote, quote: In addition to incorporating this new
association and conducting negotiations with Thiess Contractors without the
knowledge of the AWU, Blewitt and Wilson obtained a private letterbox at the
Northbridge [WA] Post Office to which all mail for the AWU Workplace Reform
Association was addressed. The AWU, says McAlpine, was unaware of its
existence. So Julia Gillard, a partner in the law firm is in a romantic
relationship with this bloke Bruce Wilson. He asks her to set up a new legal
entity for the union. She asks for no resolution of the union, no minutes of
the union meetings, no national approval for the new legal entity. She doesn’t
point out to her boyfriend that the rules of the union prohibit the establishment
of a new entity like this association.
If the new association ran the tea club or a
Tattslotto account that might be one thing , but this little cash cow did much
more than that. As I understand it, a few months after it was set up, Wilson moved
to Melbourne.
On February 13 1993 he set up a contract to buy a
house in Fitzroy. He paid $23,000 in deposit. A few days earlier he signed a
cheque from the association’s bank account for $25,000. Bear in mind that Julia
says she knew nothing about why her boyfriend needed this new association for
union business.
She said she was young and naïve, and she was,
quote, terribly distressed when she found out what he had been up to. According
to her, he was concealing it all from her. He must have been very good (at
that) because he chose her legal firm Slater & Gordon to do the
conveyancing on the purchase of the house. Slater & Gordon, the firm in
which Julia was a partner, wrote a letter to say that the amount of $67,722.30
would be required from Wilson and Blewitt to complete the sale.
The law firm said it needed a bank cheque. Well,
the firm must have trusted Wilson because there was no bank cheque, Wilson
signed a cheque from the very association that Julia Gillard had set up just a
few months before.
One of the rules of the association written to
satisfy the WA Corporate Affairs Commissioner, was, quote: “the property and
income of the Association must be applied solely in accordance with the objects
of the Association. No part of that property or income may be paid or otherwise
distributed directly or indirectly to members unquote.” Well, Wilson and
Blewitt at that stage still didn’t have quite enough money in the account to
buy the house. They needed an extra $150,000. Who lent them the money? Slater &
Gordon, Julia Gillard’s law firm. It gave them as I understand it a mortgage
for $150,000 and the firm did the conveyancing for free. This bloke Wilson
obviously was an important client. Julia Gillard was in a romantic relationship
with him for four years, until he was caught out, as I understand it, in
similar frauds using bank accounts in Melbourne. He was sprung in August 1995.
Wilson had by then renovated the house he bought
with the money he had taken out of the union in 1993. He was dealing with many builders.
Julia Gillard owned a house too. It was renovated during that time. And as the
bank statements point out, huge amounts of cash came out of the AWU Workplace
Reform Association, cash cheques for $50,000, $8,000, $5000, every few days. It
does make Craig Thomson look a bit of a miser. We don’t know where the cash
went. Julia Gillard later produced a handwritten receipt from a builder, to say
that she had paid for the renovation to her own home herself. No-one yet knows
why $18,000 was paid directly to a women’s fashion boutique in Melbourne, Town
Mode.
In August 1995 it all came crashing down. Wilson
left the union. The union paid back tens of thousands of dollars to various
construction companies. In October 1995 it was becoming very public. Wilson was
gone. The matter had been raised in the Victorian Parliament. It had been
reported that Julia Gillard was being sacked from her job with Slater &
Gordon. Julia Gillard was interviewed by The Australian on October 12,
1995. She told the reporter Ebru Yaman, “I am still a partner with Slater &
Gordon, and I have no intention of going anywhere.” Soon after that story ran,
she was gone, her desk was cleaned out. She has never practiced law since. She
was without a job, as I understand it, for six months, until Joan Kirner
arranged a role for her as chief of staff with John Brumby. Wilson was never
charged. He and his accomplice Blewitt sold the house, and the union received
not one cent of its money. A couple of people lost their jobs after trying to
report this story. Michael Smith is one of them.
Michael Smith was a policeman in Victoria. He
served in the busy Collingwood and Port Melbourne stations. He was in the
regular army for eight years. He has been a successful businessman, CEO of a
national mobile communications carrier in Jakarta Indonesia, the head of
Telstra’s global satellite business. He was chairman of the board of the
Queensland University Business School and director of the board of the
Queensland Symphony Orchestra and actually ran the orchestra as CEO for three
years. He was offered a job on Radio 4BC Brisbane, in 2008 and was very
successful at that. He moved home to Sydney and last year he hosted Radio 2UE’s
afternoon show, and he was the top rating day-time host on that station, but he
lost his job over this matter.
Michael, you have tried to raise this matter and
lost your job, how powerful have been the forces seeking not to have this
matter discussed?
Michael Smith:
Immensely. It has been done through back channels, never through a direct legal
approach. I know that on the morning that I was going to broadcast this matter,
Julia Gillard herself phoned the CEO of News Ltd, John Hartigan and made three
demands of him
1.
Hartigan withdraw a column that Glenn
Milne had published in The Australian that day
2.
That The Australian apologise
for that
3.
That News Ltd give her an undertaking
that it would never again report in any way on websites or in its newspapers on
this matter.
Jones:
Why would anyone agree to those sorts of demands?
Smith:
You would have to be present in the conversation with Hartigan. What I was told
by a very senior News Ltd executive is that threats were made by the Prime
Minister to harm the interests of News Ltd if it didn’t comply with her direct
demands of it. In my case, I worked for a radio station owned by Fairfax. Ten
minutes before I was due to go to air after having recorded an interview with
the former head of the union, Bob Kernohan, after having that exhaustively
checked legally over the weekend and producing the various documents that my
external defamation lawyer that Fairfax had engaged, required to substantiate
the truth of the things we were saying. We had been right through that process,
2UE was promoting the fact that this interview was going to go to air, so it
had been approved by 2UE management for broadcast. Ten minutes before I was
going to air, a senior executive in Fairfax from Melbourne phoned and said you
are not to broadcast it. And then it went on and on for a week or so.
Ultimately they would not permit it to be broadcast or spoken about in any
fashion. And you have to wonder what influence was brought to bear.
Jones:
This union fellow Wilson, surely he can be located? Has he changed his name or
appearance?
Smith:
I have spoken with him, I know where he is, what job, what city.
Jones:
He probably can’t speak without incriminating himself?
Smith:
Absolutely right. If he is to speak, the man seeks protection and immunity.
There are others far more senior than him who are involved in this matter. It
goes to the heart of unionism and the power of unionism.
Jones:
And the Thomson affair?
Smith:
It is identical, Alan. Michael Williamson the HSU guy, who is in the slot
himself. Williamson was to Craig Thomson exactly as another very senior union
man, Bill Ludwig, was to this bloke Wilson.
The best way I can illustrate it is this: If you
leave home to go to work, lock the house up and you left $5000 on the kitchen
table, you come home and it is gone, you call police, “My money is stolen!”.
The police say they will investigate for you. They find the fingerprints, they
find the crook. Here he is, here is the man who stole it. You look at the
crook. It is your cousin. You go, “Oh shit!”
The police say they will charge him if you give
them a statement. “I can’t make that statement, I can’t do it to my cousin”. If
it is your money and he is your cousin. That’s stiff for you, that is your
decision. But if you are a union official, it is not your money, it is the
members’ money. You can’t say if you are Williamson, “Look, Craig Thomson has
used all this money etc” but say to the police. “I am not going to give you a
statement”. That is exactly what happened with Wilson. The union chiefs would
not give a statement to police that stated we owned this money. If you go to
the Police Academy you learn the point of proof for theft, dishonesty, you
appropriate property belonging to another with intention permanently to deprive
the other of it. If you don’t have a statement from the owner of the money,
there is no charge and no offence.
Jones:
The recently appointed CEO of News Ltd Kim Williams said at the SA Press Club
last week that the public’s right to know is sacrosanct. Without apportioning
innocence or guilt to the Prime Minister, does the public have a right to know
what went on in this matter?
Smith:
Absolutely. To have confidence in our system we have a right to know. You look
at the face of someone in their 50s or 60s who has been subjected to terrible
abuse as a child. If the offender is brought to the dock even a generation
later, it gives us confidence in the fact that this is a just place, a just
community.
Jones:
When the News Ltd stuff happened in Britain, phone hacking, Julia Gillard said
that news organisations had serious questions to answer. From your understanding
of this issue, does Julia Gillard have questions to answer, without in any way
suggesting she is innocent or guilty?
Smith:
Absolutely. I can’t make a judgement about innocence or guilt. But, as a former
policeman, I can look at the facts put in front of me and work out in my own
head whether there is a prima facie case to answer.
Jones:
Well, Robert McClelland is her former Attorney General. He, not me, has raised
this matter in Federal Parliament. Was not he solicitor at the Sydney law firm
Turner Freeman acting for the AWU union officials at the time, Bill Ludwig and
Ian Cambridge?
Smith:
Absolutely. It was Ian Cambridge, a former union official in AWU, who was the
first union official in this country to call for a Royal Commission into his
own organization. The former Attorney General Rob McClelland prepared the
paperwork for that. He asked for the Royal Commission, I can see why.
Jones:
To trace the misappropriated funds?
Smith:
Absolutely, and to look at the role of senior union officials who can say to
police when they knock on the door saying here is all the evidence, such as
with Thomson, for example, and the brothels and the cash and the ATMs, how can
it be just that union officials can say to police, no I will not give you a
statement?
Jones:
If Cambridge called for a Royal Commission then, Julia Gillard has subsequently
appointed him to Fair Work Australia?
Smith: You
have to look at a number of appointments, including the recent appointment of a
federal court judge who was a partner in the same law firm with her, in the
same IR department. I would be looking very closely at a number of these
appointments if I was conducting the Royal Commission of Inquiry into this
matter.
Jones:
Cambridge has been calling on the one hand for a Royal Commission but then is
appointed (to FWA). He was the author of the affidavit when McClelland was the
solicitor. Cambridge is now in the union controlled Fair Work Australia, which
has delayed the investigation into Thomson and, as I understand it, he has not pursued
the Wilson-Gillard matter since.
Smith:
That is true. He swore an affidavit with penalty of perjury if falsely sworn.
You read it; read what he said about Slater & Gordon, and its role and Ms
Gillard was a partner who was involved in this position where she had a
conflict of interest having a sexual relationship with the man who headed up
her client, the AWU, that was undisclosed to her partners. The Law Council
would have a view about the appropriateness of that.
Jones:
Did she, as a lawyer, set up accounts into which extorted funds were diverted?
This union heavy was going around saying: I want this money, 25 thousand from
you and 30 thousand from you in order to get work done. This was 20 years ago,
and that money was shoved into another account the AWU would not know about.
Did she set up those accounts?
Smith:
I know that her handwriting is present. I have had that analysed by the
country’s pre-eminent forensic handwriting analyst, Paul Westwood. He is the
same guy who helped me out on the Craig Thomson matter, who analysed the
hand-writing on the credit card chits, the signature.
I am a layman. I can look at her handwriting, I
have a copy here and the handwriting on that form. It is identical. But the
forensic analyst tells me it is in all likelihood, balance of probabilities,
written by the same person, by her.
Jones:
The accounts set up that she as a lawyer opened at the direction of Wilson and
Blewitt have been described by an AWU executive as unauthorized, invalid,
irregular and used for quote, possibly illegal purposes. There were 13 of them.
Smith:
Yes, a large number of accounts were set up. Wilson was given the flick from
the AWU when the accounts that were established in Melbourne were discovered
and he was allowed to leave the union, and in fact got redundancy payments. The
money was paid back to the organisations that had paid the money into those
accounts, in Melbourne. Julia Gillard was questioned in Melbourne and said: I
have done nothing wrong. At that point the account she had set up in 1992 in
Perth had not been discovered. It was discovered later, after he had left the
union and after she had made the public protestation that she did nothing
wrong. She had a duty as a lawyer acting for the AWU, upon a report to her law
firm that fraud had been discovered, she had a duty to assist her client to
find the location of any further monies that might be owing to it, including
her knowledge, the fact that a cheque drawn on the association she had set up,
had been used to buy a house for a person, not for the union, and she said
nothing.
Jones:
This was in March 1993. Slater & Gordon were involved in the purchase of
this property at 85 Kerr St, Fitzroy, and money that Thiess Contractors paid
was used to pay for the property. Wilson’s signature was on the cheque.
Smith:
Absolutely.
Jones:
Thiess was apparently not aware it was paying money into a fraudulent account.
The house was sold in 1996, proceeds of the sale went to Wilson and Blewitt.
Smith:
Correct
Jones:
That was when Cambridge, the then national secretary of the AWU, swore an
affidavit that he was unable to understand how Slater & Gordon who were
then acting for the Victorian branch of the union, could have permitted use of
the funds, which were obviously taken from the union in the purchase of private
property of this nature, without seeking and obtaining proper authority from
the union.
Smith:
Absolutely. And when his Melbourne frauds were discovered in 1995 she said
nothing about the existence of the Perth accounts; she said nothing about
acting for him and his offsider for purchase of the house in Melbourne, an
asset the union could then have realized to try to get its money back. And
weeks after that she had left the law firm Slater & Gordon and never again
practiced law.
Jones:
So basically this business, this fund came into existence as a result of an
application to the WA Corporate Affairs Commissioner…
Smith:
Yes
Jones:
… to register an incorporated association and the AWU knew nothing about it..
Smith:
Absolutely right
Jones:
… and money was being funneled out into the bank accounts of that.
Smith:
Correct.
Jones:
And Cambridge became aware of all this and swore this affidavit.
Smith:
He hit the roof mate, as did Bob Kernohan, or would any just person in looking
at this. That is why he was so active calling for a Royal Commission into his
own union. He wrote to the then chief industrial relations Federal Minister
Laurie Brereton: Look mate, the only way to get to the heart of this, who was
involved, is by having a Royal Commission.
Jones:
McClelland who was sacked, the dismissed Attorney-General, he was acting for
Ludwig and Cambridge, he encouraged both of them, as I understand it, to submit
affidavits to the NSW Industrial Relations Court.
Smith:
Well, Con Sciacca was acting for Ludwig, up in Brisbane. It is factual that
McClelland was acting for Cambridge. And McClelland prepared the papers and saw
the documents and could see clearly what had gone on.
Jones:
He was in the Federal Parliament.
Smith:
He said in the House of Representatives, “What I saw then in the mid-1990s,
when I was one side as lawyer and Julia Gillard was on the other side as
lawyer, has colored my view about unions.” When I look at Thomson and the HSU
it is eerily similar. I have spoken with Rob about this. The Thomson matter
could not have happened if the call for reform which McClelland is now making,
had been heeded.
Jones:
He wants laws tightened as they apply to union accountability?
Smith:
Absolutely. If you are a shareholder of BHP and the boss there is ripping off
money for brothels and pulling out large amounts of cash, you as a shareholder
can go to the Securities Commission and they will look into it.
If you are a HSU worker you put on your purple
dress, get up at 5.30 am every morning and work in the furnace-like laundry of
the hospital, and you see Thomson ripping off money for brothels, you have no
means to bring that to the attention of the authorities.
Jones:
Ian Cambridge who swore the affidavit and had called for a Royal Commission
into his own union, was appointed by Julia Gillard to the union-controlled Fair
Work Australia, which has taken an eternity and has still not fully reported on
Thomson.
Smith:
There are number of appointments I would suggest require some scrutiny.
Jones:
The Industrial Court at the time ordered Wilson to repay some excessive
redundancy pay he awarded himself?
Smith:
Yes.
Jones:
What happened to all the other money? Was it spent like Thomson on credit
cards, and massage parlours.
Smith:
I went through Thomson’s bank statements chapter and verse, and look, as a
copper I saw that a lot of frauds started small, 100 or 200 bucks, and a bloke
says, hey I’m getting away with this, and it becomes big. It’s the same with
the Wilson matter. Except in the olden days there were no ATMs, it is cheques.
They are small now, then huge. This is great, I will buy a house, away we go.
At the time when it was discovered and when Cambridge brought his action so
vigorously before the court, the union went back to court with an application
for more time to find where its assets were and the union, headed by Ludwig,
allowed that to lapse. No-one did anything. And now Howes, boss of the union,
tells the ACTU Congress that we must run to ground all malfeasance, all crooks,
they must be found and put in gaol, and every cent of members’ money recovered.
Mate he has the files. He could commence today an investigation and he could
heed the call by McLelland to go and find the assets. He could find (those)
assets, and he has not.
Jones:
As a lawyer with Slater & Gordon, Julia Gillard wrote out the application
to register the AWU Reform Association and yet Slater & Gordon were
representing that union and lawyers for Slater & Gordon would automatically
know that unions don’t operate their activities through associations of this
kind.
Smith:
That association was a sham. I have independently spoken to various defamation
lawyers about that statement. I am absolutely confident in the truth of it. It
was established to do six things and did none of them. It advised the Corporate
Affairs Commissioner that if he registered the association in WA, it would not
do one thing — distribute money to its members. But all the six things it was
set up to do, it did none of them, and it did the one thing it promised not to
do, give money to the blokes who set it up. No-one else in the union knew about
it. It set up a private post box office. It is inconceivable that bills that
could have been generated by the law firm and forwarded to the union’s accounts
payable for advice and work setting up this association, it is inconceivable
that (the bills) could have been paid if it was fairly and properly conducted.
Jones:
Is this the reason why the government has been very, very slow to act on
Thomson and very, very silent in offering no criticism about him?
Smith:
The Labor Party is so closely affiliated with the union movement. It is so full
of people who owe their job to the support of an individual union at the Labor
Congress. The AWU is the most powerful of them.
Jones:
That is Bill Shorten’s union.
Smith:
Have a think about this one point. On the night that Rudd got the knife, who
was it went on TV on ABC LateLine to announce why Rudd was going, that he would
be replaced by Julia Gillard. It was Paul Howes, head of the AWU.
Julia is from the far left, socialist left. Bill
Ludwig, national president of the AWU, is of the far right. It is just
noteworthy that she stood by him at the AWU’s National Congress and said, “I am
proud to call Bill Ludwig my friend.”
Well Ms Gillard, that doesn’t surprise me in the
slightest.
Jones:
A final comment: Julia has said previously when questioned that she was young
and naïve, and she was terribly distressed when she found out what the
boyfriend Wilson had been up to. Would that be Wilson’s account of things?
Smith:
(laughs loudly), Alan, no.
Jones:
According to her, Wilson was concealing it all from her.
Smith:
Yeah (laughs). Bruce Wilson lives in a coastal town, he goes to work in
a very old car, he is working in the kitchen at a registered club, he works
shifts there cooking meals. He looks at Tim Mathieson and Julia Gillard getting
on the plane and thinks to himself about what he knows. What if he was
approached by the authorities? What would he have to say under oath? His
account is very different from hers. And look Alan, you just add this up, the
weight of Cambridge’s affidavit, what Ludwig has to say, what his offsider
Blewitt has to say, and all the documents, all the bank statements, all the
handwriting analyses, put that on one side of the scale, on the other side of
the scale put this statement: “I did nothing wrong, I was young and naïve.”
Jones:
OK, that is Mike Smith, actually when he last tried to raise these matters he
lost his job. It is very strange, the world we inhabit.
Smith:
Will you please indulge me, the hero of this affair is a man called Robert
Kernohan, who was offered inducements, offered seats in Parliament, who was
bashed senseless in the street, who had bullets mailed to his home address.
That man has suffered immensely and has never once wavered in his pursuit of
the return of his members’ money, and he Rob Kernohan is a hero.
Jones:
There we are. The public has to work that out for themselves. But nonetheless
the people are asking questions about how this Thomson matter still remains
unresolved. The genesis of that failure to resolve may lie in matters that
occurred many, many years ago.
Source: The 2GB interview is here…
