Chalmers gives Frydenberg free pass over ASIC report stitch-up

Appreciate our quality journalism? Please support us here

EXCLUSIVE

ANTHONY KLAN

The Albanese Government is refusing to disclose key findings of a corruption probe into the corporate regulator that were secretly deleted under former Treasurer Josh Frydenberg.

Treasurer Jim Chalmers, through a spokesman, has refused to provide the secretly deleted findings of the investigation into improper payments made to former ASIC bosses James Shipton and Daniel Crennan, saying it is “an issue for the previous government”.

The revelations come as Frydenberg again last week made national headlines over speculation he would return to politics, after losing his seat to independent Monique Kooyong at the 2022 election.

“This is a matter for the previous government” – Jim Chalmers’ office

As previously revealed, in January 2021 Frydenberg released a version of the investigation into the payments scandal from which three of the four key findings had been secretly deleted.

In what was, and remains, the biggest scandal in the 33-year history of corporate regulator the Australian Securities and Investments Commission (ASIC), it was revealed in late 2020 that its two top bosses had been given $180,000 in taxpayer funds they weren’t entitled to.

Please support our quality journalism for as little as $10 a month

Frydenberg’s doctored version of the Thom report, deleted parts shown by red lines. Source: Treasury. Emphasis: The Klaxon

Provided as “relocation expenses” to begin their roles at ASIC, chair James Shipton had been given $118,557 in personal “tax advice” and deputy chair Daniel Crennen had been given $69,621 towards the rent of his luxury Sydney family home.

Both men stood down when the scandal broke in October 2020 and the then Treasurer Frydenberg announced an “independent review” by former public servant Dr Vivienne Thom, working for private company CPM Reviews, and promised to make her findings public.

The report was commissioned by Treasury (which reports to the Treasurer) at an ultimate cost to taxpayers of $110,000, and Thom provided her final report to Frydenberg’s Treasury on December 17, 2020.

Six weeks later, on January 29, Frydenberg released a statement which said Thom “made no adverse findings regarding Mr Shipton and Mr Crennan” and that “I am satisfied that there have been no instances of misconduct by Mr Shipton”.

That was despite Frydenberg simultaneously announcing Shipton would be replaced as ASIC chair, little over halfway through his five-year term; both Crennan and Shipton repaying the money — and the payments being above the legal allowable amounts set by the Remuneration Tribunal.

Please support our quality journalism for as little as $10 a month

Along with his statement Frydenberg released a document. It was not Thom’s review, but an “abridged” version that had been “prepared by Treasury”.

Investigations by The Klaxon showed three of Thom’s four key findings had been secretly erased — the only finding not deleted relates to an instance where no wrongdoing was identified by Thom.

The matter is particularly serious because the affair only came to light after Australia’s then Auditor-General Grant Hehir — after 19 months of inaction by ASIC and Treasury — took the extremely rare action of issuing Frydenberg with a “section 26” letter, which meant the matter was forced into the open.

(According to experts it is the only time in Australian history a section 26 letter been issued).

The Auditor-General oversees the Australian National Audit Office (ANAO) which audits the accounts of government agencies. The ANAO discovered the Shipton and Crennan payments when auditing ASIC’s accounts.

In the section 26 letter to Frydenberg, Hehir said the payments to Shipton and Crennan breached public service pay rules, and he raised four specific concerns.

It is Thom’s findings regarding three of those four concerns that were secretly deleted from the version of Thom’s report released by Frydenberg.

Josh Frydenberg released a doctored version of a review into ASIC. Source: ABC News/Matt Roberts

Thom was Australia’s Inspector-General of Intelligence and Security — and so responsible for overseeing Australia’s intelligence agencies including Australian Security Intelligence Organisation (ASIO) —until her term expired in 2015, when she joined CPM Reviews.

As previously revealed, Thom resigned from CPM Reviews almost immediately after Frydenberg released the doctored version of her report.

Shipton and Crennan have repeatedly declined to comment.

When the scandal broke on October 17 2020, ASIC refused to comment, saying it would be inappropriate to do so while the Thom review was ongoing. After the Thom review, ASIC refused to comment.

On February 26, 2021 we asked: “Has ASIC’s Commission (all current commissioners) been provided with the unredacted version of Vivienne Thom’s review, which Thom filed with Treasury on December 17?”

ASIC spokesman Gervase Green responded: “Decline to comment”.

On May 28, 2021 we asked each member of ASIC’s executive whether “they agree with Mr Frydenberg’s statement that the Thom review into ASIC did not deliver any adverse findings against Mr Shipton or Mr Crennan?”.

All refused to answer.

That same day we asked Treasury Secretary Steven Kennedy, who commissioned the $110,000 Thom review, the same thing, as well as whether he “agrees with Mr Frydenberg’s statement that Mr Shipton engaged in no wrongdoing with regards to the alleged relocation payments?”

Kennedy refused to comment, instead we were directed to the same Frydenberg statement we were asking about, which Frydenberg issued when he released the doctored report.

“We have nothing further to add to the Treasurer’s (Frydenberg’s) statement on 29 January”, The Klaxon was told by Treasury.

The doctored, “abridged”, version of Thom’s report re-written by Treasury. Source: Treasury

In February last year we again put questions to ASIC and its chair Jo Longo. (Longo was appointed by Frydenberg to replace Shipton in April 2021).

We asked whether ASIC had been provided with a copy of the original, unredacted, version of the Thom report; if so what were the three findings that had been removed from the version release on January 29; and, “is it true that Thom’s report cleared Mr Shipton?”

ASIC spokesman Matthew Keenan responded: “Chair Longo commenced with ASIC in mid 2021, which was after the report was released”.

“As this is a Treasury Report, it is more appropriate for you to direct these questions to Treasury for response”, Keenan wrote.

We responded to ASIC’s Keenan that we had been “approaching Treasury for over two years about this and they refuse to comment”.

We again approached Treasury. We asked whether Treasury had been given a copy of the unredacted version of the report (it had because it commissioned it); what were the three findings removed from the version released by Mr Frydenberg on 29 Jan 2021; and “Is it true that Thom’s report cleared Mr Shipton of wrongdoing”?

Treasury did not respond.

We also put the same three questions to Treasurer Jim Chalmers — this time we received a response.

“On background, this is a matter for the previous government,” responded Chalmer’s press secretary Fergus Maguire.

(The Klaxon sought an official, on-the-record response and at no time requested or intimated otherwise).

On February 16 this year we approached ASIC and Treasury once more, seeking a copy of the Thom report.

“The ALP has come under scrutiny for failures around transparency and governance, despite having campaigned on these issues at the last federal election,” we wrote to Treasurer Chalmers.

“If we cannot gain access to the Thom report we will be seeking a copy via FoI and lodging an official complaint with the NACC”.

We received no response.

BEFORE YOU GO: As you can see from the above, truly independent, quality journalism is vital to our democracy. Please support us here for as little as $10 a month.