ICAC finds former RMS manager corrupt for awarding over $12.2 million in work to benefit friends and himself
Friday 20 May 2022
The NSW Independent Commission Against Corruption (ICAC) has found that a former manager of the then-Roads and Maritime Services (RMS) engaged in serious corrupt conduct through the awarding of over $12.2 million in work to two companies owned by his friends and manipulating processes to favour and benefit those businesses and himself.
In a report released today, Investigation into the awarding of contracts by employees of the former NSW Roads and Maritime Services (Operation Ember), the Commission finds that, from November 2015 to June 2016, Samer Soliman, while manager of RMS’s Heavy Vehicle Programs (HVP) Unit, misused his position to arrange for six RMS contracts worth almost $346,000 to be awarded to his friend Stephen Thammiah’s company, Novation Engineering Pty Ltd. The Commission found that Novation was actually a joint enterprise created with Mr Soliman.
The Commission found that Mr Soliman also misused his position to engage with Mr Thammiah in a deliberate scheme to make as much profit as possible for Novation from the supply of scales spare parts to RMS which involved, among other things, causing the payment by RMS to Novation of 27 invoices to a total of over $803,000 for scale parts, software and hardware knowing that such items would either not be supplied or, if supplied, would be subject to exorbitant mark-up by Novation. Mr Soliman received cash payments totalling $347,200 from Mr Thammiah in person, or via his own withdrawals from Novation’s account, which represented the immediate financial advantage Mr Soliman obtained from his joint enterprise with Mr Thammiah.
Mr Soliman assisted Novation to be appointed to the Heavy Vehicle Maintenance Panel and helped manipulate tender processes in Novation’s favour. He misused his position to favour Novation by manipulating RMS’s processes for a tender worth over $2 million for the procurement of 125 portable weigh scales, and for a tender worth over $7 million for the procurement of 425 portable weigh scales and 70 chargers. Altogether, Novation was corruptly awarded work totalling over $10.9 million.
Between January 2017 and August 2018, Mr Soliman also favoured the company of another friend, Ali Hamidi, who owned AZH Consulting Pty Ltd. Mr Soliman arranged for over $1.3 million in contracts to be awarded to AZH, to procure equipment and conduct studies and trials.
Between September and November 2017, Mr Soliman misused his position during the tender process for the professional services contractor (PSC) panel to ensure that AZH was a winning tenderer and was appointed to that panel. This included by manipulating the specifications of the request for tender for the PSC panel to favour AZH, by removing tender requirements he knew that AZH could not satisfy and foregrounding requirements he knew that he could represent AZH as satisfying, and drafting AZH’s tender submission for the PSC panel. Between 4 June 2017 and 9 August 2018, Mr Soliman solicited and received $177,450 from Mr Hamidi in 13 payments as an inducement or reward for exercising his official functions to favour AZH and award the company multiple RMS contracts. Altogether, AZH was corruptly awarded work totalling over $1.3 million.
The Commission has found that Mr Thammiah engaged in serious corrupt conduct. His conduct included submitting invoices for work or parts that he knew were not, or would not, be done or supplied; making cash payments, or enabling Mr Soliman to withdraw cash to the value of $347,200 from Novation’s accounts on account of Mr Soliman exercising his public official functions to favour improperly Novation in the awarding
of RMS contracts; and for submitting quotes to RMS for the supply of the weigh scales knowing that Mr Soliman had misused his position to favour Novation in the tender process.
Mr Hamidi engaged in serious corrupt conduct by submitting invoices for work he knew had not, or would not, be done and that Mr Soliman would dishonestly arrange the payment of the invoices. Mr Hamidi’s conduct also included lodging a tender submission with RMS for inclusion on the PSC panel, knowing that Mr Soliman had drafted AZH’s submission and that he had used, and would continue to use, his position to favour AZH’s appointment to the PSC panel. His payments to Mr Soliman totalling $177,450, described above, were also found to be serious corrupt conduct.
RMS HVP Unit business systems analyst, Jainesh (Jai) Singh, who was also a friend of Mr Hamidi and reported to Mr Soliman, engaged in serious corrupt conduct in October 2017, by improperly assisting AZH to be appointed to the PSC panel, by recommending its appointment, knowing that its tender submission contained false and misleading information about the experience and technical skill of AZH and Mr Hamidi, and deliberately failing to declare his conflict of interest arising from his friendship with Mr Hamidi. Between February and March 2018, he also partially and dishonestly exercised his official functions by recommending Novation as the winning tenderer for a contract valued at over $2 million and declaring that he was not aware of any situation that might lead to an actual or perceived conflict of interest, or which might affect him carrying out his functions both fairly and in RMS’s best interest, when he knew that the friendship between Mr Soliman and Mr Thammiah was such a situation.
Mr Soliman, Mr Singh, Mr Thammiah and Mr Hamidi all knew each other to varying degrees prior to their involvement with RMS. They had all worked at Optus at the same time, although not necessarily in the same section, and Mr Soliman and Mr Thammiah had a close, longstanding friendship since high school. Mr Hamidi and Mr Singh formed a close friendship while working at Optus.
The Commission found that RMS had appropriate documented policies and processes relating to goods and services procurements that were known and accessible to RMS employees, and information and advice were available from a centralised procurement team. Mr Soliman’s corrupt conduct, however, was characterised by deliberate manipulation of the procurement processes.
The report observes that other public authorities should note that this investigation demonstrates that it can be quite easy for a public official to engage in serious and systemic corrupt conduct despite the presence of a detailed policy and procedural framework. “Mr Soliman’s conduct was not opportunistic – it was planned, and he manipulated controls with strategic intent,” the report says.
The Commission found that Mr Soliman did not report conflicts of interest to RMS management, and had a significant level of control over relevant RMS procurement processes; he used this control to undermine their integrity for the benefit of Novation and AZH. His ability to control or manage the relevant procurement processes was, in part, facilitated by substantially inadequate procurement governance, which resulted in opportunities to stop his corrupt activity being missed. Mr Soliman was subject to limited managerial oversight, which also resulted in missed opportunities to stop his corrupt conduct. RMS is now part of Transport for NSW (TfNSW). The Commission has made seven recommendations to assist TfNSW to prevent such conduct from recurring.
The Commission seeks 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 is of the opinion that consideration should be given to obtaining the advice of the DPP about the prosecution of Mr Soliman, Mr Thammiah and Mr Hamidi for various offences. RMS terminated the employment of Mr Soliman and Mr Singh in 2019.
The Commission held a public inquiry in this investigation over 26 days in a number of tranches in May, June, August and October 2019. Commissioner Patricia McDonald SC presided over the inquiry, at which 10 witnesses gave evidence.