The Australian Senate are already investigating corrupt conduct by French arms firm Thales who are the parent company of DCNS which won the $50 billion Submarine contract. They are in effect one company and why the government didn’t address this issue when they announced DCNS as the winner of the Submarine contract is scandalous.
The corrupt conduct by Thales under investigation by the Senate is the rorting and rigging of a $1.5 billion contract with Airservices Australia who are a government body responsible for airspace management in Australia which includes the management of airport control towers etc.
I was tipped off about the Senate enquiry by a regular reader after I published my last article regarding previous bribery allegations against DCNS and Thales and a Liberal Party crony having his nose in the trough of the $50 billion Submarine contract. (Click here to read the article)
The Australian Senate inquiry
The Australian Senate have been investigating financial fraud and corruption at Airservices Australia since 2014 which also involves Thales and its Australian CEO Chris Jenkins. The inquiry has heard evidence of widespread fraud, nepotism and blatant corruption.
The Senate inquiry is still in progress and in 2015 they referred the matter of dodgy consultancy contracts to the Australian National Audit Office who investigate financial corruption on behalf of the government. It says on their website:
“Our purpose is to provide the Parliament with an independent assessment of selected areas of public administration, and assurance about public sector financial reporting, administration, and accountability. We do this primarily by conducting performance audits, financial statement audits, and assurance reviews.” (Click here to read more)
The National Audit Office are due to report this month, May 2016. I am sure they will be under pressure to sweep it under the carpet or at least delay the release of the report until after the election as it will be very embarrassing for the government given the $50 billion Submarine deal with DCNS / Thales.
The Airservices Australia multi-million-dollar consultancy sting
The big sting is a dodgy multi-million-dollar consultancy contract being overseen by Airservices chairman Sir Angus Houston who is a former Chief of the Air Force and Chief of the Defence Force.
How the sting works
Airservices Australia hired a consulting organisation called International Centre for Complex Project Management (ICCPM) to negotiate a $1.5 billion contract with Thales to upgrade Australia’s air traffic control program. The problem is that ICCPM is very dodgy to say the least. The former chairman and still a director of ICCPM is Thales CEO Chris Jenkins.
It should be no surprise that Thales was awarded the contract in February 2015 which is called the Onesky project. (Click here to read more)
It doesn’t get any more corrupt than this
So the net effect is that you have an organisation overseen by Chris Jenkins in his role as chairman/director (ICCPM) negotiating with Chris Jenkins in his role as CEO (Thales) to get the best deal for Airservices Australia.
Airservices Australia should have nothing to do with ICCPM as they are in effect a division of Thales. Airservices should have the expertise to negotiate themselves and if they don’t they should have employed people directly with the experience.
International Centre for Complex Project Management (ICCPM)
ICCPM is a body clearly run as slush fund / fraud outfit were people with links to it get cushy government jobs, consultancies and in Chris Jenkins case get to negotiate their own $1.5 billion contract.
This has been known to the federal government for quite a while as they started their Senate investigation in 2014 and also had hearings last year. The Australian reported in September 2015:
In the public part of that hearing, Sir Angus admitted to some problems with a “perception” of conflicts of interest associated with the $1.5 billion program to integrate the nation’s civilian and military air-traffic-control systems, known as OneSKY.
These included a “husband and wife team” on opposite sides of a transaction between Airservices and the International Centre for Complex Project Management, the consultancy group it engaged in a multi-million-dollar contract to advise it on OneSKY.
Senators also pointed to the fact Chris Jenkins, the managing director of Thales Australia, is also chairman of ICCPM, which employs former Royal Australian Air Force officer Harry Bradford on an Airservices contract worth $1 million so far to negotiate on Airservices’ behalf with Thales. (Click here to read more)
The Senate enquiry apparently hasn’t stopped the ICCPM rorting with Airservices Australia but with the National Audit Office due to report this month let’s wait and see what happens with it.
The corrupt dealings between Airservices Australia, ICCPM and Thales is almost identical to DCNS appointing former Liberal Party crony Sean Costello as CEO of DCNS to negotiate the $50 billion Submarine deal as I reported last post. And it must be remembered that Thales is accused of bribing the Malaysians over $100 million in a contract worth $2 billion. So if bribery is going on here how much would it be worth? (Click here to read more)
French arms firm Thales and their control over DCNS
The relationship between Thales and DCNS is important to know because they are really one company and should be treated by the Australian government as such.
Thales are own 35% of DCNS and are the controlling shareholder with 64% owned by the French government and 1% owned by employees.
When DCNS won the submarine contract Thales issued a number of press releases which made it clear they run the show. Thales control over DCNS helps explain why in the current Malaysian submarine bribery scandal the French authorities have indicted Bernard Baiocco who is the former head of Thales International Asia. (Click here to read more)
Above is just part of the story and you really need to read the previous post I published a few days ago to get the full picture on how bad the corruption scandal is and understand how much worse it is going to get. (Click here to read the previous post)
Culture of corruption at Airservices Australia
This is nothing new to Airservices Australia as a previous CEO, Greg Russell, resigned in 2012 after details of his corporate credit card use were leaked to the media followed by a federal government-ordered review of his overseas travel expenses. (Click here to read more) His successor as CEO Margaret Staib resigned in July 2015 to “focus on her short-term personal health”. Obviously the Senate enquiry into corruption at Airservices Australia under her management played its part in her resignation.
Airservices chairman Sir Angus Houston and Acting Prime Minister and Minister for Infrastructure Warren Truss – front – with Thales Australia CEO Chris Jenkins, Airservices CEO Margaret Staib and Chief of Air Force Air Marshal Geoff Brown at OneSky signing ceremony. (February 2015)
There are rumours that the $50 billion contract is almost double what the Germans tendered. If that’s the case, then the extra $20 billion leaves a lot of room to line pockets which Thales have already clearly been doing with Airservices Australia.
How can the federal government award a $50 billion contract to a subsidiary of a company currently under investigation by the Australian Senate for corruption and abusing contracts? I did email the Prime Minister’s office a few days ago with questions which the Department of Prime Minister and Cabinet acknowledged but so far they are refusing to answer.
I will follow-up with the PM’s office and send questions to a number of other federal politicians as this scandal has widened substantially.
The political time bomb that the Submarine contract is just keeps getting louder and louder. I think there will be at least another one or two posts on this subject before the election which is due on the 2nd July.
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