Carol Altmann – The Terrier

A blue-chip whistleblower on allegations of fraud, corruption and bullying within the Warrnambool City Council has gone public and, in so doing, exposed how broken the system has become.

Dr Bernadette Northeast, who has the sort of credentials and governance experience that most councils would grab with both hands, recently resigned as Volunteer Coordinator from the WCC, having been shafted by the very process meant to encourage people to speak up.

Boy, we live in dark times when this is considered acceptable.

Dr Northeast told me she had compiled a dossier of evidence with the input of six other people – each of whom initially approached her – detailing serious claims of fraud, corruption and bullying within certain sections of council. #notallstaff

The whistleblowers not only detailed claims of wrong doing, but alleged particular senior council staff were fully aware of the allegations and did nothing.

In other words, there was a deliberate cover up.

If you were an investigator looking into a council, this sort of stuff is red hot.

Dr Northeast and five of the six other whistleblowers all spoke to the independent investigator hired by the council CEO Peter Schneider to get to the bottom of the scandal, but despite this incredibly brave step, they have heard nothing since.

In the meantime, wait for it, Dr Northeast was put under investigation by the same independent investigator.

Her “crime” was accessing documents she used as part of her evidence gathering, for which she found herself accused of serious gross misconduct.

This is despite the documents apparently being accessible to any council staff member via the intranet.

Dr Northeast, who worked for the council for seven years, was put on paid leave during the investigation, after which she resigned for another job.

During the investigation of Dr Northeast’s conduct and in the months since, she says, there has been no significant action as a result of the whistleblowers coming forward.

Each person identified by the whistleblowers, apart from former tourism chief David McMahon, has remained in their job.

As Dr Northeast says, it appears the investigation has been less focussed on the claims of fraud, corruption and bullying that were allegedly reported to senior staff, and more intent on finding out “who dobbed on us?”

By the way, the allegations not only include the now infamous misuse and abuse of some council corporate credit cards, but also claims of misuse of council accommodation at Flagstaff Hill, misuse of council contracts, purchase of equipment (including air conditioning units) which cannot be traced, and large alcohol purchases via direct invoice.

The whistleblowers also raised concerns about a personal relationship between two council staff members that allegedly led to “tip offs” about the focus of some Freedom of Information applications.

Others expressed their concern at a “boozy” boys’ club culture, summed up by a toga party held at the house of a senior staff member, to which select staff were invited and attended, and talked about for days.

This cosy boys’ club culture is what the vast majority of hard-working and ethical staff at WCC have been struggling with for years.

It reminds me of the WCC Christmas party at the Warrnambool racecourse last year, where two employees dropped their pants and ran naked past the finish line in what was apparently some sort of weird WCC tradition. It wasn’t repeated this year.

This sense of entitlement among certain parts of council is what we believed Mr Schneider would blow right open and, to do so, Dr Northeast is exactly the sort of person he should be listening to.

Her CV includes 17 years as an SES volunteer, a Director of South West Healthcare, Chair of Australian Institute of Company Directors Great South Coast Committee, and Deputy Chair of the Victorian Fisheries Authority. Good governance is her bent.

Yet Mr Schneider has not spoken to Dr Northeast about any of these allegations.

Mayor Tony Herbert, who has previously urged staff with any allegations to contact Mr Schneider, apparently told Dr Northeast that he would arrange a meeting with the CEO. She didn’t hear another word. (I have asked Cr Herbert to confirm this).

Dr Northeast then attempted to set up a meeting with Mr Schneider herself, without success, and says even now she remains open to a frank conversation with the CEO.

But Dr Northeast is no longer with the council, having been effectively the target of a concerted push to find any leakers.

A couple of other staff are also on unexplained leave, for what I believe are similar misconduct allegations connected to them attempting to reveal what is going on, not to hide it.

Other experienced staff have resigned in sheer frustration while waiting for a cultural change that never seems to come.

If this is how it works at the WCC, something is terribly broken.

This gets to the nub of why Dr Northeast has gone public, because she says the vast majority of council staff who are hard-working, ethical and honest people, are being unfairly maligned by the alleged actions of a few.

“For the sake of the vast majority of all the good people working at the council, this needs to be addressed promptly and openly. Yet we have heard nothing more,” she says.

“How long does this have to go on without direct rectification?”

It is a very good question and here are three more:

Where is the independent investigation up to?

Has the information from Dr Northeast and the six whistleblowers all been passed to the Ombudsman for her separate investigation?

And does the council even still have 81 corporate credit cards in action?

I am putting all of this to Mr Schneider for a response which I will run in full.

I have set up a Foxy Fighting Fund. If you would like to be make a small contribution, you can do so below.

The Foxy Fighting Fund

Carol Altmann – The Terrier

The time has come to use our voices, stand up for Lyndoch and show that Warrnambool will not tolerate bullies, no matter who they are, where they come from, or what they promise.

I have now had contact with 33 people, including past and present Lyndoch workers, about the toxic culture and the warped priorities that have allegedly taken root within its walls. By the end of this weekend, I will have spoken to 36.

We can’t turn away and expect the victims of this culture to fix it; they can’t.

Instead we, as a community of terriers, need to get involved, to step up and hold the Lyndoch board to account for what is unfolding on its watch.

We did this with the Warrnambool City Council credit card scandal and we can do it again.

Some of Lyndoch’s most senior and experienced staff are among the 70 to 80 people who have left in the past two years and the resignations just keep coming, yet the board remains silent.

If this was happening in a primary school, or our hospital, or inside TAFE, it would be front page news.

So would some of the decisions around the use of public funds.

As it stands, Lyndoch Living – as a registered charity – has spent more than $100,000 on gambling via sponsoring a steeplechase and hosting a corporate marquee at the May races, and somehow this passes as core business.

We also know that Lyndoch plans to spend millions of dollars to build and run a new medical centre that nobody has asked for, while at the same time it doesn’t have enough experienced nurses to fill shifts, and basic furniture needs replacing.

Enough.

I am unable to look on while personal power trips are pursued at the expense of Lyndoch staff wellbeing and, ultimately, the care of our elderly.

So this is what we can do:

– contact the board: chair Kerry Nelson (knelson@mpower.org.au) or any of the other board members: Andrew Paton, Cr Sue Cassidy, Ron Page, Percy Eccles, Kane Grant, Peter Downs, Suzanne Coulson and Lorraine Mielnik via a letter to Lyndoch Living, 10 Hopkins Rd, Warrnambool.

– ask the board about staff morale, staff resignations and Lyndoch’s core priorities;

– contact our local MP Roma Britnell (roma.britnell@parliament.vic.gov.au) and ask her to investigate, just as her Liberal colleague Cindy McLeish did in response to the troubles at Seymour Health;

– write a letter to the editor of the local newspaper which, unfortunately, no longer does investigative journalism;

– most importantly, become a member of Lyndoch: it’s free to apply, can be done by filling out a simple form, and means you can have a say on where Lyndoch is heading and who is in charge.

 

At the moment, Lyndoch has very few members, including the nine people on the board, two life members (Ron Patterson, David Atkinson), the CEO Doreen Power, and four senior staff.

It’s a tight little shop.

Under the new rules of Lyndoch (last year it changed from an association to a company limited by guarantee), these members have significant powers, including standing for the board, voting for the board, and being involved in the AGM.

In fact, unless you are a member, Lyndoch has no obligation to even tell you when the AGM will be held.

This is what happened last October when, for the first time, the Lyndoch AGM was not advertised, nor were the board vacancies.

But here’s the rub: the board gets to decide who can become a member of Lyndoch, so even if you apply, you may not be accepted.

It’s open to all sorts of manipulation and perhaps explains why the current board is such a curious mix.

There are no GPs on the board. There is no lawyer.

But there is the former CEO of the Warrnambool Racing Club, Mr Downs, who now lives in Melbourne and works for Moonee Valley: if that’s not a massive conflict of interest between the board and Lyndoch’s support for racing, Barry the Bullshite Detector and I will run three times around the racecourse.

(Actually, Barry, we will need to do four laps, because Ms Power and Mr Downs also have shares in a racehorse.)

The Lyndoch company secretary – a former PA to Ms Power – also has no accounting or legal qualifications, despite now monitoring a multi-million-dollar organisation.

From all the evidence, none of these people in charge are asking the hard questions about Lyndoch’s operations, or none are asking them publicly.

Cr Cassidy, for example, has gone from being a power house to a mouse. The bold woman who stood up and exposed the games behind the council mayoral race has nothing to say about Lyndoch. She won’t return my calls.

Chair Kerry Nelson? Not a word.

They are supposed to be our eyes and ears, yet all we have is silence.

To me, the entire Lyndoch board and senior executive are accountable for the distress of every single Lyndoch person who is suffering or has suffered.

So I am going to keep exposing what I know, and I am going to also apply to become a member of Lyndoch, although I doubt I will be accepted, even though my mother was in Lyndoch for 10 years, and my late Dad, as a bricklayer, helped build some of it.

Warrnambool people started Lyndoch, we still own it, and we all have a stake in caring for its residents, its staff and its future.

What started as an important story for me is now a campaign – unashamedly – to restore a bold community voice inside Lyndoch and to stand up for those who need us to be strong.

On we go.

You can find the Lyndoch membership form here and its new constitution here.

Next: digging into the multi-million-dollar medical clinic.

If you would like to support the work of The Terrier, you can throw something in the tip jar.

Terrier Tip Jar

Carol Altmann – The Terrier

If we need a canary in the coal mine about what is unfolding at Lyndoch Living, it’s what happened at the Seymour hospital earlier this decade.

Seymour hospital was plagued with problems in the early 2000s, with a string of doctors resigning, a loss of birthing services, a dysfunctional board, and four official inquiries into the mess in less than two years.

Into this crisis came Doreen Power, who was appointed CEO of Seymour Health in 2007 and left in 2012, during which time the hospital saw many changes and the small town of 7000 people virtually imploded.

Ms Power, who is now CEO of Lyndoch Living, was hired by the Seymour hospital to get things done and she did: birthing services were resumed, the doctors came back to work, and the hard-working staff at the hospital continued to provide the best services that they could.

But behind the scenes of all this “success” was a human train wreck of broken, dis-spirited people, many of whom were allegedly treated so appallingly that they are only just starting to recover and some say they never will.

I have spoken to many people from Seymour about this period and the same stories are repeated over and over:

staff being bullied, losing their jobs for no reason, being “marched off the premises” without warning, hounded over minor issues, feeling disempowered, afraid, depressed and having “nowhere to turn” because the board either wouldn’t listen, or wasn’t told.

This sounds frightening familiar to what is now allegedly unfolding at Lyndoch Living.

“People became severely depressed and traumatised and felt there was nobody who could help them,” said one Seymour woman who spoke on the condition of anonymity.

“There was a sense the board had been hand-picked and they wouldn’t help. You were told if you approached the board, you would be dismissed…if you wanted to keep your job, you had to shut up.”

In desperation, some staff organised a Seymour version of an underground resistance by wearing green ribbons to work as a sign that they were a “safe” person to approach if you were being bullied.

Can you imagine?

The terrible reality for these Seymour staff is nobody from the hospital board stepped up, staff were too scared to speak up, and the damage rolled on until the wider community was alerted to what was happening.

An anonymous letter drop was circulated throughout Seymour in early 2012 and local state MP Cindy McLeish, now deputy Opposition leader, was bombarded by people pleading for her to intervene.

Ms Power resigned as CEO in May 2012, just two months before Ms McLeish organised a public meeting that was held in the local footy clubrooms before a capacity crowd of more than 300 people. Nobody from the hospital executive showed up.

Neither Ms Power or the executive, however, escaped the wrath of the crowd.

“The meeting saw pent-up community frustration released about perceived high staff turnover at the hospital, allegations of bullying, a “toxic” workplace, former chief executive Doreen Power and the change from a community hospital to a ‘bean counter mentality’ among other things,” the Seymour Telegraph reported.

Seymour GP Dr Elliot Jarman was among the passionate speakers in the audience. He was quoted by the paper as saying:

“Over 25 years Seymour Hospital has evolved to provide first-class services. I’m proud of that. What I am not proud of is staff absolutely in tears, intimidated…what’s happening is (wrong).

“I’ve been to the courts, I’ve been to Worksafe…(they’re) unable to help. I’ve been seeing patients and my fellow colleagues in tears. It’s just not right. Our services are being damaged by the current management style.”

Another Seymour GP, Dr Rob Peterson, told the meeting that three core issues needed to be addressed immediately: improved communications from the board to staff, allegations of bullying, and low staff morale. Bang, bang, bang.

By the time of the town meeting, it’s understood up to 50 staff had left the hospital, either from being pressured or being fired, and a string of Fair Work claims that followed – I believe up to 14 or 15 –  have only recently been finalised.

“It broke this town and I don’t think it has ever fully recovered,” said one Seymour source.

Seymour ultimately had an intervention, with a ministerial appointment made to the hospital board to report back to then Health Minister David Davis.

By the end of 2012, the hospital chair had resigned and most of the executive team had been cleaned out after their positions became untenable.

As a local blogger, Seymour Dreaming, wrote: “why has the board been conspicuously silent when the community expressed concerns over controversial events for which is was ultimately responsible?”

Why indeed?

And then this, a heart-felt letter to the paper from resident, Janet McKenzie, which says it all:

“The (hospital) board…and past and present executive staff need to be accountable for the shame, hurt, stress and humiliation that has been placed on these staff and their families.

They deserve so much better treatment, as do volunteers who have so generously given their time…

These staff and volunteers must receive an unconditional apology and compensation/reinstatement for the treatment they have received at the hands of (the hospital).

It is not acceptable that is ignored as these are staff and volunteers who have given many years of unblemished, caring and passionate service..

Finally, I, like many other family members of the above staff will be there to give support, assistance and much needed emotional care to those that the (hospital) has abandoned.”

The canary is coughing at Lyndoch Living and I hope the board is listening, because this management style hasn’t happened just once before, but twice.

Next: Plenty Valley.

If you would like to support the work of The Terrier, please consider throwing something in the tip jar.

Terrier Tip Jar

Carol Altmann – The Terrier

Holy moly, I step away from Warrnambool for three weeks and return to find the place is on fire, with whistleblowers dropping an A-bomb right onto the Warrnambool City Council.

A string of red-hot allegations has been sent to Ratepayers Victoria after its president, Dean Hurlston, urged council staff to “whistle loudly” if they knew anything about the misuse of public money following the WCC credit card scandal.

Mr Hurlston has listed the allegations in a letter sent yesterday to WCC Mayor Tony Herbert and CEO Peter Schneider, and paints a damning picture of what was allegedly going on behind closed doors.

The allegations include cover-ups, mismanagement, fraudulent behaviour and a lack of action in response to staff concerns that stretched to the very top.

We even, allegedly, paid for private parties dressed up as “events”.

Here is the list:

Attempts over time to raise significant concerns of fraudulent spending and cover up of same;

Systematic abuse of internal controls of authorisation of spending by management;

Coercion and direction by senior management to subvert said controls and “help hide” spending;

Direction to suppliers to “alter” the contents of invoices to hide the true nature of expenditure;

The use of WCC resources for personal or family benefit;

The use of WCC assets for personal gain;

Inadequate reporting of expenditure (thousands of dollars’ worth of transactions reported as “supplies”);

“Parties” and “events” openly abusing the use of council funds (ratepayers’ monies); and

WCC not investigating or attempting to recover falsely procured items.

You might want to read that list twice, as I did, to digest it.

It sums up all of the issues that have been swirling around the WCC “credit card scandal” which, as I have said so many times, is just the tip of the iceberg.

Mr Hurlston has urged the whistleblowers to contact IBAC and the Local Government Inspectorate immediately and seek confidential and protected disclosure. (I am going to add to that and say they should also contact the Victorian Ombudsman straight away, where an inquiry is already underway. The number is 9613 6222.)

He has also urged the council to appoint an external investigator so all staff with any information about misconduct are able to speak freely and openly.

To be clear, at this stage these are allegations only, but the fact the whistleblowers have gone to RV in the first place speaks volumes.

Whistleblowers take an enormous risk and nobody throws themselves into that line of fire without weighing up the potential cost of being exposed and punished.

It comes as no surprise to me that RV says in its letter that some staff claim they have been intimidated and bullied “for trying to expose the truth”.

Yep, I know all about those tactics, and I can only imagine how dis-spiriting and terrifying it must be for those who depend on the council for their livelihood.

The WCC is still doing all it can to shut people up, including me, but it won’t work.

Why?

Because too many people want the truth.

You want the truth. The whistleblowers want the truth. Ratepayers Victoria want the truth. I want the truth.

So the council may continue to spend hours of energy trying to shut this all down, to limit the damage, to flush out the leakers, and to punish or discredit those who speak up, but it won’t work.

And our sole newspaper may prefer to write stories about desperate people stealing twiggy sticks or passion pop, but uncovering corporate crime and mismanagement is a slow, complicated and often boring process. Twiggy sticks get more clicks.

Yet the truth always rises to the top.

I call it a slow burn.

Even when a bombshell drops like today, it can take months or even years to peg out all the facts, but it will happen and it will be well worth it because that, dear terriers, is what accountability is all about.

It’s good to be back.

If you would like to support the work of The Terrier, please consider throwing something in the tip jar.

Terrier Tip Jar

Carol Altmann – The Terrier

I very rarely do this in writing, but it’s time to drop the f-bomb.

Fraud.

It is not a word to be used lightly, but there is no doubt it is circling over the credit card scandal engulfing the Warrnambool City Council.

This is how the Victoria Police define fraud: “any deceitful or intentionally dishonest conduct, involving acts or omissions or the making of false statements, orally or in writing, with the objective of obtaining money or other benefit from a person/organisation for him/herself or another”.

Hmm, sounds like we might have a match.

The public response to this scandal is clear: ratepayers don’t want another review that goes nowhere, they want to know if there was fraud and, if so, what is being done about it?

In other words, it’s time to bring in the big guns.

This saga goes well beyond tourism chief David McMahon resigning and moving on, despite the council chiefs working hard to try and contain the fallout.

The CEO and councillors have known about this issue for months, but are now apparently gagged from speaking for legal reasons, which is no doubt a huge relief to those councillors who have not said a word.

I get nervous about speaking up too, but when it comes to backing the public, I would rather drown in a sea of truth than cling to a system designed to keep ratepayers in the dark.

We are still being kept in the dark, because none of what we have been told so far makes any sense.

Things got off to a bad start when CEO Peter Schneider, in telling council staff that Mr McMahon had quit, praised Mr McMahon’s many achievements and wished him well, as you do.

He then explained that the credit card repayments Mr McMahon and former CEO Bruce Anson nutted out over a table last November were work related.

Work related?

Why on earth would Mr McMahon be asked to repay more than $4000 from his own pocket – and possibly up to to $6000 according to my sources – if it was all work related?

And why would Mr McMahon agree?

I don’t know of anyone who would willingly hand over more than $4000 to their boss for work-related expenses.

And why, if everything was just a huge misunderstanding, did Mr McMahon give up his $100,000-plus a year job?

One of those expenses repaid was $736.50 for a “room hire” at the Lady Bay Resort just last September for a “conference” that the council, so far, can’t explain.

Did Mr McMahon accidentally hire a conference room at the Lady Bay? I had a look (see above) and unless you are booking a wedding, the Lady Bay Resort doesn’t have room hire that costs $736.50. The most expensive is $300.

It appears Mr McMahon also inadvertently spent several hundred dollars on drinks at the Cape Schanck resort and more on dinner at the Pickled Pig and also at the Warrnambool Hotel, and mistakenly bought a gift voucher for a full car detail, and gift vouchers for massages at the Logan’s Beach spa resort.

Mr Schneider now says all of this was “work related”, but at the same time, Mr McMahon repaid the cost and has since left his job.

Nothing makes sense and it never does when you’re only getting half the story.

Mayor Tony Herbert’s contribution so far is to tell the paper he is “very disappointed” and he could “understand” ratepayers’ “views”.

Views!  Ratepayers are bloody furious, and rightly so.

Because Cr Herbert, who promised to cut costs wherever he could, was there, along with Cr Owen, at the Cape Schanck conference when Mr McMahon shouted hundreds of dollars worth of drinks at the bar.

And Cr Herbert and Cr Owen were both there when Mr McMahon paid for every single VEAC breakfast and brunch.

Cr Herbert, you need to be so, so much more than “disappointed”.

And then we have the ratepayers’ money that hasn’t been repaid, but should have been.

There are at least seven occasions where Mr McMahon claimed food bills for VEAC meetings that were not official VEAC meetings, including the $172.50 “smoking gun” dinner at Bojangles on 31 May last year.

City Growth Manager Andrew Paton was Mr McMahon’s boss and a member of VEAC.

Mr Paton was also, ultimately, responsible for authorising Mr McMahon’s credit card spending.

Did Mr Paton not notice the bills for at least seven VEAC meetings that were not actually VEAC meetings? And if not, why not?

And to really hammer home the point, Mr McMahon – at Bojangles on 31 May last year – knowingly used ratepayers’ money to pay $172.50 for food and drinks that had nothing to do with council business.

And he lied on the council records.  And he organised for a receipt to replace the original.

F-word anyone?

We paid for all this.

This is why when it comes to public money, there are mandatory reporting laws and the CEO has to notify at least the anti-corruption bureau (IBAC) of potential wrongdoing.

I would have thought a report to the police would also be mandatory.

Mr Schneider says the council is “fully aware of its reporting obligations”, so I would imagine the council has reported this issue to IBAC and perhaps the police.

We can only hope so, and that a full, independent investigation follows into Mr McMahon’s spending and the spending on all 81 of the council’s corporate credit cards.

This whole credit card scandal happened because of, at the very least, a lack of scrutiny and transparency.

How far it goes, how deep it goes, and who else is caught in the net remains to be seen and – again – will only be settled by a full and frank investigation.

As the saying goes, those with nothing to hide have nothing to fear.

Having been ripped off for months before anybody noticed, WCC ratepayers deserve nothing less.

If you would like to support The Terrier, please consider throwing something in the tip jar.

Terrier Tip Jar