ICAC finds corrupt conduct against former Sydney Ferries CEO for corporate credit card misuse

Wednesday 4 November 2009

The Independent Commission Against Corruption (ICAC) has made corrupt conduct findings against former Sydney Ferries Chief Executive Officer, Geoffrey Smith, for misusing his corporate credit card to incur personal expenditure of more than $237,000.

In its report on an Investigation into the misuse of Sydney Ferries corporate credit cards, released today, the Commission also found that Mr Smith engaged in corrupt conduct by knowingly falsely claiming in a letter to the Minister for Transport in October 2008 that Sydney Ferries' use of corporate credit cards was in full compliance with government policy so that he could hide from the Minister the fact he used his card for personal use.

The ICAC is of the opinion that consideration should be given to obtaining the advice of the Director of Public Prosecutions (DPP) with respect to the prosecution of Mr Smith for offences under the State Owned Corporations Act 1989 and for the common law offence of misconduct in public office, and of former Sydney Ferries Chief Financial Officer, Vincenzo Rossello, for giving false or misleading evidence contrary to the Independent Commission Against Corruption Act 1988.

The Commission found that between September 2006 and March 2009, Mr Smith charged a total of $237,102.23 of personal expenses to his Sydney Ferries corporate credit card. He did so knowing that he was not entitled to use the card to incur personal expenses and that its use was restricted to Sydney Ferries business expenses. Mr Smith's personal expenses included petrol, school fees and groceries.

Mr Smith also incurred other personal expenses in addition to the use of the corporate credit card. These included more than $7,000 in travel fares for Mr Smith's wife to travel with him when he attended conferences in Melbourne and Hong Kong that were paid for through a Diners Club credit card issued to Sydney Ferries. The report notes that these airfare expenses have not been repaid. "Mrs Smith's airfares were paid out of the public purse and remain outstanding," it says.

In late 2008, Mr Smith directed his Executive Assistant to book and pay for a Sydney Ferries executive Christmas lunch that cost $2,410 on her Sydney Ferries corporate credit card. Although the Commission is not satisfied that Mr Smith was aware that this conduct contravened government policy prohibiting the use of State funds for such functions, the report notes that a "responsible CEO would have made himself aware of relevant policies before authorising the expenditure of public funds".

The Commission has also made four corruption prevention recommendations to Sydney Ferries, including that its annual reporting requirements in relation to credit card use be based on actual certification of compliance with the Treasurer's directions. The Commission also notes that since the allegations against Mr Smith were made, Sydney Ferries has implemented a number of other corruption prevention measures.

The Commission conducted a public inquiry, as part of this investigation, over four days between 24 and 29 June 2009. The ICAC Commissioner, the Hon Jerrold Cripps QC, presided at the inquiry at which 10 witnesses gave evidence.

Fact sheet

Investigation report