Findings of corrupt conduct
The ICAC has made 17 corrupt conduct findings against the former General Manager of Burwood Council, Pasquale (Pat) Romano. The corrupt conduct in which Mr Romano engaged included:
- using his position at the Council to engage IPP Consulting Pty Ltd for personal purposes to conduct surveillance on a work colleague of his wife, and knowingly causing the invoices for the work, which amounted to over $35,000, to be paid by the Council
- using IPP Consulting to conduct surveillance on candidates for the 2008 council elections, although he knew this fell outside the proper performance of his functions as the General Manager, and knowingly causing the $15,485 invoice for this work to be paid by the Council
- failing to manage appropriately his conflict of interest in the recruitment to Council of his friend, Albert Becerra, and in the payment of $41,400 to Mr Becerra above his contracted remuneration
- procuring work on units in which he had a personal interest from Council officers during Council time
- taking adverse managerial action against four Council whistleblowers.
Recommendations for prosecutions
The Commission must seek the advice of the Director of Public Prosecutions (DPP) on whether any prosecution should be commenced. The DPP determines whether any criminal charges can be laid, and conducts all prosecutions. The Commission provides information on this website in relation to the status of prosecution recommendations and outcomes as advised by the DPP. The progress of matters is generally within the hands of the DPP. Accordingly, the Commission does not directly notify persons affected of advice received from the DPP or the progress of their matters generally.
The Commission formed the opinion that consideration should be given to obtaining the advice of the DPP with respect to the prosecution of Mr Romano as follows:
- four offences of giving false or misleading documents to the Council with intent to defraud the Council, contrary to section 249C of the Crimes Act 1900
- four common law offences of misconduct in public office
- one offence of obtaining financial advantage by false or misleading statements, contrary to section 178BB of the Crimes Act
- two offences of causing detrimental action to be taken against a person who made protected disclosures, contrary to the Protected Disclosures Act 1994 (now named the Public Interest Disclosures Act 1994)
- three offences of causing or procuring disadvantage to persons for or on account of those persons assisting the ICAC, contrary to section 93 of the Independent Commission Against Corruption Act 1988
- two offences of providing false or misleading evidence to the Commission contrary to section 87 of the ICAC Act.
This opinion was detailed in the Commission's report on this investigation.
On 16 March 2011 and 14 April 2011, the DPP advised that proceedings be commenced as canvassed in the Commission's opinion except that it advised the Commission not to proceed with offences pursuant to section 20 of the Protected Disclosures Act 1994. This advice was accepted by the ICAC.
On 16 May 2014, Mr Romano pleaded guilty to 3 counts of misconduct in public office, 3 counts of give false or misleading evidence pursuant to section 87(1) of the ICAC Act, and 1 count of fraudulent appropriation pursuant to section 124 of the Crimes Act.
The Court was asked to take into account matters contained on a Form 1. This contained 6 counts of obtain financial advantage by deception pursuant to section 187BA of the Crimes Act, and 3 counts of give false or misleading evidence pursuant to section 87(1) of the ICAC Act.
On 7 November 2014, His Honour Justice Arnott SC sentenced Mr Romano to imprisonment for an aggregate term of 2 years and 6 months, with a non-parole period of 20 months.
Mr Romano lodged a notice of intention to appeal. The time for appeal has lapsed.
Recommendations for disciplinary action
As Mr Romano's contract as General Manager has been terminated, the issue of taking disciplinary action against him does not arise.
Recommendations for corruption prevention
The ICAC has made the following 31 corruption prevention recommendations; some of these recommendations are to Burwood Council, while others are made to the NSW Government to help improve systems in local government across the state:
Recommendation 1
That Burwood Council develops a policy for the payment of appropriate out-of-pocket expenses incurred by the General Manager and Council employees. Such a policy should incorporate the provisions of the NSW Government Expenses Policy.
Recommendation 2
That Burwood Council's out-of-pocket expenses policy for staff and the General Manager includes protocols for the approval of out-of-pocket expenditure. The protocols should explicitly prohibit the General Manager or any other Council employee from approving expenses where there is an actual or perceived personal benefit derived from the expenditure. The protocol should also provide that the Mayor must approve the expense claims of the General Manager.
Recommendation 3
That Burwood Council modifies its Councillor Expenses and Facilities Policy to require the payment of expenses and the provision of facilities to Councillors only where specifically provided for in the Policy.
Recommendation 4
That Burwood Council modifies the Councillor Expenses and Facilities Policy to require the approval of significant Councillor expenses and facilities, where possible, at a full Council meeting. Where approval at a full Council meeting is not possible or appropriate then approval should be given jointly by the Mayor and the General Manager. If the Mayor requires approval, it should be given jointly by the Deputy Mayor or another Councillor and the General Manager.
Recommendation 5
That Burwood Council aligns its Motor Vehicle Management Policy to reflect key areas of NSW state government policy and practice, including preference for leasing, cars not exceeding the luxury car tax threshold, procedures for disposal and appropriate treatment of optional accessories.
Recommendation 6
That contracts and remuneration packages for the General Manager and senior staff at Burwood Council comply with the Council's Motor Vehicle Management Policy.
Recommendation 7
That the NSW Division of Local Government be given the authority through legislative amendment to require councils in NSW to adopt policy and practice considered to be of state-wide significance by the Division's Chief Executive. This amendment should include an appeal mechanism to the Chief Executive for councils seeking specific dispensation.
Recommendation 8
That non-compliance with the requirement for adoption of policy (as described in recommendation 7) be dealt with as a discipline issue for relevant council administrative officers under the Model Code of Conduct for Local Councils in NSW.
Recommendation 9
That the NSW Division of Local Government reviews all circulars and pronouncements by the Department of Premier and Cabinet for issues of relevance to NSW local councils and issues guidelines to councils accordingly.
Recommendation 10
That the NSW Minister for Local Government seeks legislative amendment to the Local Government Act 1993 to establish internal audit for local authorities as a statutory function.
Recommendation 11
That Burwood Council establishes an internal audit function with an independent internal audit committee as a matter of priority. This committee should be chaired by a person independent of the Council.
Recommendation 12
That the elected body of Burwood Council receives regular updates on the outcome of internal audits.
Recommendation 13
That the NSW Minister for Local Government seeks legislative amendments to the Local Government Act 1993 to require general managers to report to the elected council a decision to dismiss an internal auditor and the reasons for the decision.
Recommendation 14
That the NSW Minister for Local Government seeks legislative amendments to the Local Government Act 1993 to provide internal auditors unfettered access to all documents and any council staff they deem necessary for the conduct of their role.
Recommendation 15
That the NSW Minister for Local Government amends Part 9.2(d) of the Model Code of Conduct for Local Councils in NSW to allow councillors to provide information to an internal auditor on any matter related to council business.
Recommendation 16
That the NSW Minister for Local Government seeks legislative amendment of section 376(2) of the Local Government Act 1993 to remove the automatic entitlement of a general manager to attend an audit committee meeting.
Recommendation 17
That Burwood Council's internal audit function monitors compliance with the Councillor Expenses and Facilities Policy as part of its oversight role.
Recommendation 18
That Burwood Council's internal audit function monitors compliance with Council's (foreshadowed) policy for the payment of out-of-pocket expenses to the General Manager and staff.
Recommendation 19
That Burwood Council's internal audit function monitors compliance with Council's system for allocating work to legal practitioners.
Recommendation 20
That Burwood Council's internal audit function conducts audits of the authorisation, certification and approval processes for expenditure that is unusual by its nature or its infrequency.
Recommendation 21
That Burwood Council amends its Code of Conduct and the Employee's Handbook to clearly prescribe that all complaints concerning the General Manager be referred to the Mayor in the first instance. If the Mayor is also implicated, the complaint should be referred to the NSW Division of Local Government.
Recommendation 22
That Burwood Council policies be amended to prohibit the General Manager from having any involvement or giving directions to staff in relation to any formal or informal complaints where he/she is the subject of the complaint. This recommendation does not prohibit the General Manager from providing information or a statement as part of the investigation process.
Recommendation 23
That Burwood Council amends its Internal Reporting System to include an officer's line manager/supervisor as a designated officer to whom a protected disclosure can be made. All officers to whom a protected disclosure can be made under the policy should receive training on how they should deal with a protected disclosure.
Recommendation 24
That Burwood Council ensures that the handling and investigation of complaints about the General Manager are overseen by the Mayor and conducted by investigators who are independent of the Council.
Recommendation 25
That Burwood Council develops a suspension policy for all Council staff aligned to the intention and effect of Premier and Cabinet guidelines for the NSW public sector, as espoused in Premier's Memorandum 94/35.
Recommendation 26
That the Chief Executive of the NSW Division of Local Government amends the Standard contract for the employment of general managers to include specific provision for a council to suspend the general manager from duty on a reasonable apprehension that he/she has engaged in corrupt conduct or serious misconduct.
Recommendation 27
That Part 3 of the Model Code of Conduct for Local Councils in NSW be amended to improve the guidance provided to mayors in managing complaints against a general manager. In particular, guidance should be provided about the consideration of the suspension of the general manager in appropriate cases. A duty should also be placed on the mayor to monitor decisions and actions of the general manager and other council officers for possible detrimental action against staff or contractors who have provided information about alleged misconduct.
Recommendation 28
That the NSW Division of Local Government endorses a core package of information for trainers to deliver to councillors. The package should be tailored to the needs of new and existing councillors.
Recommendation 29
That all NSW councillors undertake a foundation education and training program endorsed by the NSW Division of Local Government, at a minimum of once per term.
Recommendation 30
That all current Burwood Council Councillors undertake a foundation education and training program endorsed by the NSW Division of Local Government as a matter of priority.
Recommendation 31
That the NSW Division of Local Government promotes its capacity to provide information and assistance to councillors in the discharge of their role.
Implementation Plans
The implementation plans posted below have been provided by Burwood Council and the NSW Division of Local Government in response to the ICAC's corruption prevention recommendations. Their appearance here is for information only and does not constitute the approval or endorsement of the plan by the Commission.
Burwood Council - Implementation plan
NSW Division of Local Government - Implementation plan
12 month progress report
The progress report posted below has been provided by NSW Division of Local Government in response to the ICAC's corruption prevention recommendations. Its appearance here is for information only and does not constitute the approval or endorsement of the report by the Commission.
NSW Division of Local Government - Progress report
24 month final progress report
The final progress report posted below has been provided by the Office of Local Government in response to the ICAC's corruption prevention recommendations. Its appearance here is for information only and does not constitute the approval or endorsement of the report by the Commission.
Office of Local Government - Final progress report