The former head of a government department hit by one of Western Australia's biggest corruption scandals since WA Inc is set to be grilled in public for the first time since details of the $27 million swindle emerged.
Former Department of Communities senior bureaucrat Paul Whyte was jailed in November for 12 years for the massive theft of taxpayer funds, which he perpetrated in part by submitting invoices for non-existent work from a friend's companies.
He used the money to fund a lavish lifestyle and feed his gambling habit and involvement with racehorses.
The Corruption and Crime Commission has taken the unusual step of holding public examinations into the department, to determine how such large-scale fraud could have taken place and what governance systems are in place at the massive department.
The commission made some proceedings public in 2020, prior to Whyte's criminal trial.
Chief financial officer quizzed about invoices
This week, the questioning of two witnesses is being made public, with the department's former director-general Grahame Searle to give evidence in public on Friday and chief financial officer Lorne O'Mara, who gave evidence on Monday.
Mr O'Mara was shown a series of invoices for combined payments of just under $50,000 each per month that were paid to a company called Boldline with Whyte's corporate credit card.
A business formally trading as Boldline Business Services and operating under the same ABN is owned by an associate of Whyte's, who is also facing criminal charges.
Mr Searle was in charge of authorising payments made by Whyte on his corporate credit card.
Counsel assisting the commissioner Anthony Willinge asked Mr O'Mara whether these invoices would have caused him concern.
Mr O'Mara said Mr Searle should have asked what the payments were for.
"It smells", Mr O'Mara said. "There is no project number attached."
The ABC is not suggesting Mr Searle was aware of or involved with Whyte's fraud.
Mr O'Mara today characterised Mr Searle's leadership as "quite aloof" and "private sector-style", saying he delegated a lot of decision-making and focused instead on strategic issues.
The hearing heard that under Mr Searle, Mr O'Mara was not able to report directly to him on matters of finance but reported to another person, who themselves reported to Whyte.
Whyte reported to Mr Searle.
Whyte could approve own projects
Mr O'Mara said under Mr Searle, business became more complicated as the department started to rely more heavily on contract labour, which Mr O'Mara said ended up costing more.
He also detailed how two financial controls were removed with the implementation of systems favoured by Mr Searle.
Due to issues with accounting software called AX2012, introduced under Mr Searle, purchase orders stopped being used inside that system.
Mr Searle also asked for contract staff attached to that program to be let go.
Those staff performed a process known as "receipting" — matching purchase orders to invoices — which was one of the financial controls in place.
Mr O'Mara said Whyte should not have been placed in charge of both financing of projects and accounting, as he could effectively approve his own projects.
The hearing continues on Friday.
