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Legislative Assembly for the ACT: 1997 Week 14 Hansard (11 December) . . Page.. 5007 ..

MR KAINE (continuing):

I think the most significant thing that Mr Burbidge brought out in his report was the fact that at least four of the promoters of VITAB were involved in fraudulent conduct in a number of ways, both in formulating the contract with ACTTAB in the first place and then later on in accepting $3.3m "compensation" - that is in inverted commas - as a settlement that was eventually reached after ACTTAB was ejected from the Victorian TAB's superpool. So we, at the official level, were confronted with a group of fraudulent people who, clearly, deliberately set out to make some money at the expense of the ACT taxpayers.

Mr Burbidge has found that the principals of VITAB deliberately misrepresented the company's position. They knew exactly what they were doing. They were not playing a game; they were playing for keeps. They represented this as a business for channelling Asian bets into the Australian TAB system. That was far from the purpose for which the VITAB company was formed. It was in fact created, according to Mr Burbidge, to take advantage of the low tax regime in Vanuatu, and through that to retain the bulk of the 15 per cent commission betting turnover which in Australia is retained by the totalisator agency boards for government taxes to support the local racing industry and to cover their operating expenses.

Mr Burbidge tells us that the great bulk of VITAB's betting turnover was, and was always intended to be, sourced from two particular bookmaking agencies. One of those was the Numbawan Betting Shop in Port Vila. We now know that that betting shop was run for the benefit of one man, Mr Alan Tripp, who has a long history of convictions for gaming offences in Victoria, at least in connection with racing. So we have this corporation that was set up with the deliberate purpose of defrauding somebody. Well, we happen to be the victims.

That company concealed the true ownership of VITAB from ACTTAB through the execution of a shareholder's agreement which was not disclosed. There were, apparently, six parties identified as the major beneficiaries under that agreement, and one of those major stakeholders was Mr Peter Bartholomew. When you look through the names of the people involved with VITAB and who were to be the beneficiaries of it, it is quite clear that they set out to defraud, and, in the end, it was the ACT taxpayers who were defrauded. I mentioned earlier that the word "deception" is used throughout the report. I quote from the report:

... the deception as to the actual promoters in VITAB Limited was brought about by the belief that some of their number at least would not pass probity tests, and the whole arrangement might thereby be jeopardised.

So there was a deliberate deception. The interests of the shareholders were concealed from the people at our end who were negotiating, and the reasons for that deception are now made clear by Mr Burbidge.

That question of probity tests is a crucial one because the inquiry found that no probity checks were ever undertaken by ACTTAB prior to the signing of the VITAB agreement. There seems to have been some confusion amongst the players in the game as to who should have conducted these probity tests. I think it is pretty clear that everybody

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