Health union official lodges fraud complaint

A SENIOR Health Services Union official has lodged a complaint with the New South Wales police alleging "systemic and organised fraud within the HSU, including the procuring of secret commissions and corrupt rewards from suppliers and contractors".

By InvestSMART · 10 Sep 2011

By InvestSMART ·
10 Sep 2011

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The Sydney Morning Herald revealed yesterday that the union's national president, Michael Williamson, and federal MP Craig Thomson, formerly the general secretary of the union, were given credit cards by a major supplier to the union.

John Gilleland, who is paid $680,000 a year to produce the Union's newsletter, Health Standard, has previously provided Mr Thomson and Mr Williamson with credit cards that were attached to his American Express account.

Earlier this year, Mr Gilleland's wife, Carron, complained to several union officials that Mr Williamson had "run amok" with the credit card and had used it to pay for a variety of things, including expensive wines for his cellar, as well as his children's private school fees.

The union official who lodged the preliminary complaint yesterday has sought a meeting with police on Monday to provide a detailed statement.

Mr Williamson, who sits on the ALP national executive, yesterday issued a statement rejecting the allegations raised by the Herald. The Labor powerbroker said he was seeking legal advice and had "no further comments on this matter".

Apart from his union salary, Mr Williamson's company United Edge bills the union hundreds of thousands of dollars a year for mobile phones and IT services.

His directorship of United Edge is not revealed to members in the annual reports. Nor is it revealed in advertisements in the union newsletter, where the company offers discounts on union membership in return for signing up to United Edge mobile phone plans.

Mr Thomson, who quit the union in 2007 to become a federal MP, is facing allegations of using his union credit card to make more than $100,000 in cash withdrawals during his time as union boss, as well as using the card to pay for escort services in Sydney. Mr Thomson has denied the allegations.

A former HSU official spoke yesterday of the free-spending ways under the stewardship of Mr Williamson and Mr Thomson: "If you went somewhere, you didn't just buy a bottle of wine, you bought the best bottle of wine. Everything was always put on the union credit card."

Most Thursdays, 10 or 12 people from the Health Services Union would enjoy long, boozy lunches and the tab was always picked up by Mr Williamson, who put in on his union credit card, the former official said.

" In NSW when this was going on, the party in many ways lost its moral compass," he said. "No one of any ethical authority said to these guys, 'You are not doing the right thing."'

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Frequently Asked Questions about this Article…

What is the HSU fraud complaint that was lodged with NSW police?

A senior Health Services Union (HSU) official lodged a preliminary complaint with New South Wales police alleging "systemic and organised fraud within the HSU," including the procuring of secret commissions and corrupt rewards from suppliers and contractors. The complainant has sought a meeting with police to provide a detailed statement.

Which union figures are named in the allegations reported about the HSU?

The Sydney Morning Herald report named HSU national president Michael Williamson and former general secretary (and now federal MP) Craig Thomson. The reporting also refers to John Gilleland, who produced the union newsletter and provided credit cards that were allegedly used by union leaders.

What credit‑card misuse allegations have been reported about the Health Services Union?

The article says credit cards were reportedly given to Williamson and Thomson by a major supplier. John Gilleland previously provided them with cards attached to his American Express account. Allegations include Williamson using a card to pay for expensive wines and private school fees, and claims that Thomson made more than $100,000 in cash withdrawals and used a card to pay for escort services. Both men have denied aspects of the reporting: Williamson rejected the allegations and is seeking legal advice, and Thomson has denied the allegations.

What is United Edge and how is it linked to the HSU in the article?

United Edge is a company connected to Michael Williamson. The article states United Edge bills the union hundreds of thousands of dollars a year for mobile phones and IT services. It also says Williamson’s directorship of United Edge is not disclosed to members in annual reports or in the union newsletter.

How much is the HSU newsletter producer paid, and what role did he play in the credit card issue?

John Gilleland, who produces the HSU’s newsletter Health Standard, is reported to be paid $680,000 a year. The article says he previously provided credit cards—linked to his American Express account—to Craig Thomson and Michael Williamson.

How have Michael Williamson and Craig Thomson responded to the allegations?

According to the article, Michael Williamson issued a statement rejecting the allegations, said he was seeking legal advice, and had no further comment. Craig Thomson has also denied the allegations reported about his use of a union credit card.

What descriptions of HSU spending culture appear in the report and why might that matter to stakeholders?

A former HSU official described a free‑spending culture under Williamson and Thomson, saying union credit cards were frequently used for high‑end purchases and long, boozy lunches paid on the union card. For members and stakeholders this raises questions about governance, oversight and how union funds were managed.

Were any disclosure or transparency issues highlighted in the article about the HSU and related companies?

Yes. The article notes Williamson’s directorship of United Edge is not revealed to members in the union’s annual reports, nor is it disclosed in newsletter advertisements where United Edge offered discounts in return for members signing up to its mobile plans. Those points are presented in the article as potential disclosure concerns.