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ICAC

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Contact Armstrong Legal:
Sydney: (02) 9261 4555

John Sutton
Craig Robinson
Andrew Tiedt
Andrew Fraser
Mariah Maltezos
Sarah Marinovic
Michael Hempsall
Will Del Din
Trudie Cameron

What does the Independent Commission Against Corruption (ICAC) do?

The ICAC’s main functions are:

  • To investigate and expose corrupt conduct in the NSW public sector
  • To actively prevent corruption through advice and assistance, and
  • To educate the NSW community and public sector about corruption and its effects

What are the aims of the ICAC?

The ICAC’s aim is to fight corruption and improve the integrity of the NSW public sector by investigating, exposing and minimising corruption. This is to protect the public interest and prevent breaches of public trust.

What type of matters can the ICAC deal with?

The ICAC is legally required to:

  • Investigate only matters that it has been given power to investigate:
    • Any allegation or circumstance which (in the ICAC’s opinion) implies that corrupt conduct has occurred, or conduct likely to allow, encourage or cause corrupt conduct
    • Corrupt conduct involving or affecting most of the NSW public sector, including state government agencies, local government authorities, members of Parliament and the judiciary (magistrates and judges). However, it does not deal with police corruption. This is dealt with by the Police Integrity Commission.
  • Investigate all matters referred by both houses of the NSW Parliament
  • Publish reports on matters investigated in a public inquiry or matters referred by both houses of the NSW Parliament, and
  • Act within its powers given by the law (Independent Commission Against Corruption Act 1988)

The ICAC cannot:

  • Deal with matters of personal complaint
  • Investigate complaints about the conduct of police officers
  • Investigate matters relating to the public service of the other states or to Australian public service where there is no connection to the NSW public sector or NSW public officials

What is considered "corrupt conduct"?

  • any conduct that could negatively affect the honest or impartial exercise of official functions by any public official, group of public officials or any public authority
  • any conduct of a public official that constitutes or involves dishonest or impartial exercises of his/her official functions
  • any conduct of a public official or former public official that constitutes or involves a breach of public trust, or
  • any conduct of a public official or former public official that involves the misuse of information acquired in the course of his/her official functions, whether for his/her own benefit or someone else’s benefit
  • any conduct that could negatively affect the exercise of official functions by any public official, group of public officials or any public authority and which could involve matters such as misconduct relating to election, fraud, theft, bribery, blackmail, tax and revenue evasion, illegal drug dealings and gambling, forgery, treason, homicide or violence, etc.1
  • However, conduct only amounts to corrupt conduct if it could constitute or involve:
    • A criminal offence, or
    • a disciplinary offence, or
    • reasonable grounds for dismissing, dispensing with the services of or otherwise terminating the services of a public official, or
    • in the case of conduct of a Minister or an Member of Parliament – a substantial breach of a relevant code of conduct2

What powers does the ICAC have?

The ICAC has powers to gather information for their investigations. This allows them to:

  • compel the production of documents or other things
  • compel a public authority or public official to provide information
  • enter properties occupied by a public authority or public official to inspect and copy documents
  • obtain warrants to search properties
  • use surveillance devices and intercept telephone calls
  • compel witnesses to answer questions at compulsory examinations (private hearings) and public inquiries.

Do I have to answer questions asked by the ICAC?

A person who is called or examined as a witness before the Commission must answer its questions.

What are the consequences if I do not comply?

If you refuse to be sworn in or make an affirmation (i.e. promise that you will tell the truth) or if you refuse or otherwise fail to answer any question put by the Commissioner or Assistant Commissioner, you will be guilty of contempt.

The Commissioner may present a "contempt of the Commission certificate" to the Supreme Court, where the Commissioner sets out the facts that constitute the alleged contempt. The Commissioner will then investigate the alleged contempt. The Supreme Court may punish you if it finds that you are guilty of contempt. Punishment for contempt can be a fine or imprisonment. You may not be punished if you can show that you had a reasonable excuse for failing to answer the Commissioner’s questions.

What are the consequences if I commit perjury (give false information)?

A person who knowingly gives false or misleading evidence is guilty of an indictable (more serious) offence. The maximum penalty is $22,000 or 5 years’ imprisonment, or both.

Interesting cases and results

"Operation Challenger" – Canada Bay City Council (CCBC)

Background: In May 2009, Mr Hraichie alleged that CCBC contractors had made corrupt payments to a CCBC officer, Mr Higgs. Mr Hraichie claimed that his company had missed out on the opportunity to apply to be one of CCBC’s preferred civil contractors, and that this was because Mr Higgs wanted to exclude him so that Mr Higgs’ friend, Mr Turner, could get more CCBC work. Mr Hraichie also claimed that Mr Turner had previously paid Mr Higgs in return for getting CCBC work.

The second issue Mr Hraichie claimed was that Mr Higgs had told him he could successfully quote to do work on a separate project if he paid Mr Higgs $2000 for each stage of the project. Mr Hraichie claimed he paid Mr Higgs $6000, and that other contractors had made payments to Mr Higgs as well.

Investigations: The ICAC conducted investigations where Mr Higgs, Mr Turner and Mr Hraichie were examined. It also obtained documents and information to investigate Mr Higgs’ financial position. The ICAC found that Mr Higgs had paid off a large home mortgage in just over four years, when the family income was insufficient to account for such a quick and substantial repayment. It examined whether this was the result of corrupt payments Mr Higgs received from CCBC contractors. In addition, a public inquiry was held.

Result: It was found that Mr Higgs had engaged in corrupt conduct. However, no finding of corrupt conduct was made against Mr Hraichie. The ICAC was of the opinion that the Director of Public Prosecutions’ advice be sought for the prosecution of Mr Higgs for offences of receiving corrupt rewards, giving false and misleading evidence and fabricating a document with intent to mislead the ICAC. Since Mr Higgs resigned from the CCBC after the public inquiry, it was not necessary for the ICAC to consider disciplinary action to be taken against him.

The ICAC was of the opinion that the DPP’s advice be sought in relation to prosecution of Mr Turner for giving a corrupt benefit to Mr Higgs, giving false and misleading evidence, fabricating a document with the intent to mislead the ICAC. In addition, the ICAC made recommendations to prevent further corruption.

"Operation Bellin" – Department of Education and Training (DET)

Background: Allegations were made in 2008 that the parents of a boy at Westmead Public school had paid their son’s teacher $2500 and had written a letter to ask for favourable consideration in school assessments, so that it would enhance his chances of gaining entry into a selective public high school.

Investigations: The ICAC interviewed and took statements from a number of witnesses, made enquiries to the relevant financial institutions and conducted a public enquiry.

Result: Findings of corrupt conduct were made against the parents. The ICAC was of the opinion that consideration should be given to obtaining the Director of Public Prosecution’s advice with respect to prosecution of the parents for offences of corrupt commissions or rewards.

"Operation Monto" – RailCorp

Background: This investigation exposed a long history of widespread corruption in RailCorp. It involved employees and managers at various levels of the organization. The ICAC investigated allegations of fraud, bribery, improper allocation of contracts, unauthorized secondary employment, failure to declare conflicts of interest, falsification of time sheets and the cover-up of a safety breach.

Investigations: It was discovered that RailCorp employees had improperly allocated contracts totaling almost $19 million to companies of by themselves, their friends or their families, in return for corrupt payments totaling more than $2.5 million. The ICAC exposed a huge amount of public sector corruption through its investigations, which included lawfully intercepting telephone conversations of RailCorp employees engaging in corrupt conduct.

Result: The ICAC found that the structure of the organization and its operations allowed and encouraged corruption, and the form of contracting, culture and reporting arrangements contributed to prevalent corruption. Moreover, there was weak oversight by the RailCorp Board, outsourcing of the provision of goods and services without adequate safeguards and incompetent management which further allowed corruption to develop. Corrupt employees appeared confident they would not be caught, or if they were, that the consequences would not be severe.

The ICAC made 96 findings of corrupt conduct against 31 people and stated that consideration should be given to obtaining the Director of Public Prosecution’s advice on prosecution of 33 individuals for a total of 663 criminal offences. The final report made 40 corruption prevention recommendations about changes to RailCorp’s structure, practices and procedures to reduce similar corrupt conduct.


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where to next?

If you suspect that you may be under investigation, or if you have been charged with an offence, it is vital to get competent legal advice as early as possible. Our lawyers are highly specialised in criminal law and will be able to guide you through the process while dealing with the various authorities related to your matter.

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