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ICAC alleges corruption by former university staff

Not all is kosher in the ICT department, writes Madeleine King.

An easily missed notice in last week’s Sydney Morning Herald revealed the Independent Commission Against Corruption (ICAC) would be holding a public inquiry into alleged corruption by former University of Sydney Information and Communications Technology (ICT) staff and contractors.

Proceedings in the ambiguously named ‘Operation Citrus’ began last Tuesday in a quiet building off Castlereagh Street and continued throughout the week. According to Assisting Counsel, Jeremy Morris, the accused – Todd Demiralay – encouraged the almost exclusive use of the IT recruiting company, Succuro, during his time as a senior manager in the University’s ICT Department. During his four years in this position, he apparently failed to disclose to his supervisors and fellow staff that his wife, Virginia Kantarzis, was both the company’s director and secretary, and that the couple held a fifty per cent share of Succuro’s assets in trust.

As Demiralay moved up through the department, the University’s use of Sucurro increased.  Prior to Mr Demiralay and Mrs Kantarzis taking over the business, the University’s invoice to the recruitment company was just $3,080.00 in 2006. By the end of the 2010 financial year – a year after Demiralay was nominated as a shareholder – the University was sending invoices totalling $537,722.00.  Mr Morris notes that because there was no formal contract between Succuro and the University of Sydney, “nobody could pick up on extraordinary growth in use of Succuro in dollar terms or Demiralay’s connection with the company.”

According to proceedings so far, Demiralay’s alleged corruption went further. He was on the selection panel for George Tsipidis, a Succuro contractor and among many of the company’s employees who over the years sought permanent employment in the University ICT Department. Tsipidis was appointed to a permanent position under Demiralay – his undisclosed brother-in-law. A range of similar nepotistic activities have also been levelled at Demiralay.

According to Mr Morris’ opening address, Demiralay’s alleged actions could be construed as manipulative and deliberately evasive. But the Assisting Counsel was equally critical of the University’s complacency in regards to staff recruitment procedures. The University of Sydney failed to follow simple steps during the recruitment process “to determine whether any conflict existed, conduct that breached the University’s own internal policies could go on undetected for years,” Mr Morris said. While Codes of Conduct were attached to both advertised positions and employment contracts, “the University did nothing outside their policies to detect and ensure compliance with those policies.”

This is also not the first time the University has been investigated by ICAC in recent years. In September 2010, the Commission handed down its findings in another very similar case, where $350, 000 worth of contracts were awarded by a University cleaning employee to a company she owned with her husband. It was these findings, sent via email to Demiralay by a colleague during 2009, which saw a major restructuring of Succuro. Within two days of receiving the email, Demiralay and his wife apparently transferred their shares across to their business partner, formally renamed the company ‘I-Secure’, and saw Mrs Kantarzis resign as company director and secretary.

The inquiry’s first witness, Madeleine McCabe – a current University of Sydney ICT manager – admitted the department’s reliance on Succuro came at fraught time. The ICT departments across the faculties were consolidating, and a number of reconstruction projects were underway which were suited to the “very short-term” staff Succuro was able to provide. Regardless of the circumstances of their employment, the department was “certainly happy with the staff [from Succuro] we were getting.”

On a similar note to McCabe, Assisting Counsel Morris qualified that the “inquiry does not seek to challenge the University’s use of contractors or criticise its desire to have a degree of administrative or managerial flexibility, but it will examine whether these practices contributed to any corrupt conduct.”

At the time of writing, the public inquiry is ongoing with a number of witness testimonies still to be heard. The results of the inquiry and ICAC’s final ruling on Demiralay’s conduct will be released in the coming weeks.

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