An overview of recent allegations of corrupt conduct in universities

10 mins  02.06.2015 Pamela Madafiglio, Tom Fletcher

Introduction 

Universities are increasingly finding themselves dealing with allegations of "corrupt conduct" and/or "misconduct" – that is, conduct which, if proved, could fall within the jurisdiction of a State regulator (Corruption Regulator), established by a State Act (Corruption Act), charged with maintaining the public's confidence in the operation of public sector agencies and combating and reducing the incidence of major corruption and crime in the public sector.

Investigations by a Corruption Regulator (or by a university or external investigator pursuant to a Corruption Act) can pose serious reputational concerns for a university.

In recent years, we have seen Corruption Regulators target senior "scalps", with investigations and/or findings leading to or coinciding with resignations of Vice-Chancellors in Queensland1 and New South Wales.2 A Vice-Chancellor in Western Australia is currently suspended, pending assessment by the WA Corruption Regulator of an internal investigation at the university.3 These are just the matters that have become public: we are aware that other senior executives of universities have been the subject of investigations by Corruption Regulators (or independent investigations pursuant to Corruption Acts), findings in respect of which have not led to publication or adverse consequences for the executives involved.

Broader investigations can cause serious reputational damage to the higher education sector. That has undoubtedly followed the recent Four Corners' investigation into the alleged use of unethical, and in some cases fraudulent, agents engaged by Australian universities to recruit international students for admission. This investigation coincided with the release of the NSW Corruption Regulator's April 2015 report, Learning the Hard Way: Managing Corruption Risks associated with International Students at Universities in NSW (ICAC Report).4

The ambit of each Corruption Regulator's jurisdiction varies, and conduct which falls within the jurisdiction of one may not necessarily be conduct which another can investigate. Further, the approach and resources of each Corruption Regulator, and sometimes the best way of responding to a matter that is subject to its jurisdiction, also differ. Our lawyers in each jurisdiction have significant experience in this area.

What is uniform, however, is that each Corruption Regulator has a broad jurisdiction. Relatively less serious conduct by low-level employees can be captured by the various definitions, sometimes triggering an obligation to notify the conduct to the Corruption Regulator and/or report on the outcome of the investigation. For example, allegations that a senior academic engaged in conduct amounting to bullying of a junior academic. Or allegations that casual employees made claims for payment other than strictly in accordance with the terms of their employment. The extent to which a Corruption Regulator becomes involved in a university's investigation and handling of such matters varies between Corruption Regulators (and sometimes between particular investigators of a Corruption Regulator).

More serious conduct by high-level executives/officers, or even members of the governing body, is likely to be of greater interest, and the Corruption Regulator may choose to carry out the investigation itself (using a broad range of investigative powers) or at least, insist on the appointment of a well-credentialed independent external investigator in the first instance to make findings and recommendations.

Ready reckoner

We have prepared a table as a kind of "ready reckoner" for comparing the Corruption Regulators in each jurisdiction, including the legislation pursuant to which they are established, related whistleblower / public interest disclosure legislation, the conduct which they regulate, how that conduct can relate to universities and a summary of their investigative powers. As we have paraphrased the conduct regulated by each Corruption Regulator; the table is only a guide and should not be used as a substitute for careful consideration of the relevant legislation when determining whether particular allegations are subject to obligations under a particular Corruption Act.

In the next edition of Higher Education Focus, we will be considering some topical issues concerning Corruption Regulators and their activities in relation to universities, including in relation to:

  • universities that have interstate and international campuses;
  • the use of agents to recruit international students, as considered in the ICAC report; and
  • the implications of the High Court's decision in Independent Commission Against Corruption v Cunneen & Ors [2015] HCA 14, in relation to the jurisdiction of the Corruption Regulators to investigate the conduct of private individuals that relate to the performance of official functions.

1 See the website of The University of Queensland, http://www.uq.edu.au/news/article/2013/09/uq-statement-cmc-report (accessed 11 May 2015).
2 See the article "Top two depart after university plagiarism case", Sydney Morning Herald, 17 February 2004, http://www.smh.com.au/articles/2004/02/16/1076779907258.html (accessed 11 May 2015).
3 See the website of Murdoch University, http://media.murdoch.edu.au/vice-chancellor-stood-aside (accessed 11 May 2015).
4 Available on the website of ICAC, http://www.icac.nsw.gov.au/media-centre/media-releases/article/4781 (accessed 11 May 2015).

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