The Great Telecard Coverup

By Margo Kingston
November 24, 2000
Source: Webdiary SMH

John Howard and Peter Reith

It had to be dragged out of them, but officials from the Department of Finance today made some big admissions on the Reith Telecard affair under pressure from the Senate estimates committee.

Try as they might to dodge, waffle and prevaricate, the masters of cross-examination, Labor Senators John Faulkner and Robert Ray, shed a little bit more light on the great coverup.

The scandal broke in the Canberra Times on Tuesday October 10, nearly a year after Finance discovered the $50,000 fraud. The very next day, the Prime Minister announced that DPP Damian Bugg had decided to prosecute no-one over the fraud. He also said he had asked the Solicitor-General, David Bennett QC, to advise whether Reith was liable for the $50,000.

This reference to Bennett was made much of by Howard as proof of his good faith. Remember both he and Reith, when the story broke, said there was no obligation for Reith to pay.

Well guess what? Way back in May, Finance wrote to Reith saying it would issue him a debit notice for the full amount, based on legal advice that he WAS liable. That advice was given by a legal officer in the department. (Finance today refused to release that advice.)

Reith said no. Instead, he sent Finance a cheque for $950 a week later, which he claimed was the cost of calls made by his son Paul, to whom he unlawfully gave the card details to make private calls. On October nine, the day before the story broke, Finance again wrote to Reith demanding he pay up as legally required.

A Bugg in the farce of the Reith Telecard affair

By Margo Kingston
Source: Webdiary SMH
November 22, 2000

Mr Bugg during a senate legal and constitutional legislation committee. Photo: JACKY GHOSSEIN

Every year Senators get to quiz bureaucrats and statutory officers on their performance and the success or otherwise of government policies. It’s called “Senate Estimates”, is designed to ensure that public money is well spent and is one of many reasons why the Senate is the last hope for Parliament, representing the people, to get answers not spin doctored by the executive (the Prime Minister and his ministers). Freedom FROM information is the executive’s motto but in Senate estimates, evidence is under oath, so those under the gun have to be more careful than politicians are with the truth.

Today, the Senate’s Legal and Constitutional committee got its chance to put the Commonwealth Director of Public Prosecutions, Damian Bugg QC, to the test on his handling of the Reith Telecard affair.

I’ve written about the behaviour of Mr Bugg extensively in the diary (see The Small Matter of Prosecution and Telecard Shenanigans) and his performance today only confirmed widespread concern that he has neglected his duty to preserve public confidence in the integrity of the administration of justice.

The Reith Telecard scandal burst into the public sphere just last month. His decision not to prosecute anyone for anything is the most controversial he has made as DPP. He must have realised he would be asked questions on the matter by Labor Senators. (Government Senators rarely if ever ask questions on behalf of the people and instead sit there to protect witnesses from having to reveal things the Government doesn’t want revealed. It’s called betrayal of the people.)

The small matter of prosecution on the Telecard Affair.

By Margo Kingston
Source: Webdiary SMH
October 16, 2000

Mr Peter Reith – Telecard Affair

To fill you in on DPP Damian Bugg to date.

His brief statement of last week made no mention of whether he would charge anyone apart from Reith and son but the Prime Minister’s office advised us today that Mr Bugg had decided not to prosecute anyone, including X and Y.

Solicitor-General David Bennett QC, briefed by John Howard to advise on civil liability, has reserved his position on whether Miss X or Mr Y are civilly liable. He says Miss X’s actions ”would, at first sight, give rise to an action against her for unjust enrichment”. She could also be ”liable to Telstra for deceit”. Of Mr Y, he says that on any version of events ”he acted dishonestly”.

So the question is, why won’t Bugg prosecute Y or X for fraud?

Attorney-General Daryl Williams QC, as his is wont, won’t say anything except that Bugg is an independent statutory officer and all answers must come from him, if he choses to make them.

But Peter Reith – God bless his soul – has effectively demanded criminal action against Miss X and Mr Y. He’s a lawyer, too, and he doesn’t seem to have a problem with the fact that his son Paul, who lived in the same house as Miss X but denies giving her the Telecard number and PIN, would have to take the stand.

He also doesn’t seem to have a problem with what the public’s reaction might be to the pollie and his son, who are at the head of the chain of events which led to the fraud, not being charged while the non-pollies further down the chain were.