A specialist police taskforce has launched a major investigation into a multimillion-dollar Metro Tunnel rort that Big Build officials and contractors knew about for months but never formally relayed to police.
Taskforce Hawk only began its inquiry into the alleged October 2024 rip-off – where $6 million was claimed for ‘damaged’ machinery which was never replaced – after it was exposed in reporting by this masthead 16 months after the suspected corruption occurred.
The launch of the taskforce probe, and the revelations that it was sparked by media reports rather than a formal government notification, is the latest development to raise serious questions about the effectiveness of state Labor’s response to the continuing Big Build scandals.
Victoria Police confirmed in a statement that it had launched an inquiry into allegations that employees of Swiss corporate behemoth Schindler perpetrated a multimillion-dollar fraud after the firm was hired to provide and install escalators on the Metro Tunnel project.
“Detectives from Taskforce Hawk are investigating after information was provided to them in regard to invoicing anomalies linked to a company involved in a CBD building project,” the statement said.
“As the investigation is ongoing, it would be inappropriate to comment further at this time.”
Three sources aware of the alleged rorting, but who asked to speak on the condition of anonymity, said the failure of Victorian infrastructure officials and the Metro Tunnel consortium to alert police when they first discovered suspicions of the Schindler rort had prevented detectives from using covert investigative techniques or launching an inquiry many months ago.
A central tenet of Premier Jacinta Allan’s response to claims of wrongdoing on the Big Build is to urge the immediate reporting of misconduct to police. She has also repeatedly pointed to the dozens of charges laid by Taskforce Hawk to defend her response to continuing revelations of Big Build rorting, waste and criminal infiltration.
But an analysis by this masthead of Hawk’s prosecutions can reveal that as yet, not a single case before the courts relates directly to Big Build corruption or the improper use of funds from it.
Rather, the police prosecutions include: outlaw bikies who worked as former Big Build union delegates yet who are facing extortion charges over a private property development; senior union officials charged with relatively minor offending, such as using a carriage service to menace, with no connection to the Big Build; minor gangland figures charged with firebombing construction companies unrelated to the Big Build; and two labour hire company owners charged over fraudulent conduct.
As recently as last week, the state government’s North East Link consortium was overseeing the payment of Big Build funds to controversial labour hire firm Women In Construction, despite revelations in The Age it was run and managed by men with criminal convictions, including for domestic violence, and had hired gangland figure Mick Gatto as an adviser.
On Friday, Allan described the allegations facing Women in Construction as “horrific” and again highlighted the success of Taskforce Hawk to defend her government’s response to the series of Big Build scandals.
She told a budget estimates hearing police and industry regulators were cleaning up the construction industry, with 88 criminal charges laid, 151 licences cancelled and a further 48 licences blocked. Transport Infrastructure Minister Gabrielle Williams is due to front the hearing on Monday.
The allegedly criminal plot at the centre of the latest Hawk probe involves the Australian arm of Schindler Group, which was hired to supply around 200 escalators and elevators to the Metro Tunnel.
The suspected fraud involves Schindler’s claims to the project consortium that flooding in October 2024 had damaged escalators and it would need an extra $6 million for replacement machinery and labour. After the money was paid, CCTV was reviewed, revealing no damaged equipment was ever replaced.
The alleged fraud was confirmed in two subsequent internal investigations that were not given to police when they were completed: one by Schindler and the other by the Labor government’s Cross Yarra Partnership Metro Tunnel consortium.
While the consortium did not tell police after the fraud was discovered, it did brief the public servants overseeing the new rail line about the scandal.
Schindler ultimately admitted the fraud, removed three employees and repaid the funds, but the police’s Taskforce Hawk only learned in any detail about the alleged theft after it appeared in this masthead on February 20.
Obtaining a financial advantage by deception is a serious criminal offence in Victoria carrying a maximum penalty of 10 years’ imprisonment.
In a statement, Victoria Police previously confirmed no one from the Big Build ever lodged a “formal report” of the allegedly criminal conduct involving Schindler.
But Schindler’s alleged Big Build corporate corruption was known to the Metro Tunnel consortium and state Labor government officials working for the Victorian Infrastructure Delivery Authority.
In a previous statement, Schindler’s Australian headquarters did not explain why it did not formally alert police but confirmed it had become aware of concerns from the Metro Tunnel consortium.
“Schindler conducted an internal investigation in conjunction with our customer, which identified misconduct by a small number of Schindler employees. This was an isolated incident. The relevant employees involved were dealt with in accordance with Schindler’s internal procedures,” it said.
When this masthead previously asked the Victorian Infrastructure Delivery Authority why it had not formally reported the alleged Schindler swindle for criminal investigation, it referred the matter to the government.
In February, CFMEU corruption buster Geoffrey Watson, SC, caused a political storm after estimating Big Build rorts had cost Victorian taxpayers $15 billion, a figure dismissed by the Allan government. Watson also urged an agency with special royal commission-type powers to launch an inquiry.
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Nick McKenzie is an Age investigative journalist who has three times been named the Graham Perkin Australian Journalist of the Year. A winner of 20 Walkley Awards, including the Gold Walkley, he investigates politics, business, foreign affairs and criminal justice.Connect via email.From our partners
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