When Tasmanian Liberal director Damien Mantach garnered a spectacular promotion to Victorian deputy president in 2011, he left Tasmania to great fanfare and fond farewells.
With champagne toasts still lingering in the air, the party newsletter triumphantly said Mantach left the Tasmanian division “in excellent shape and Damien is to be congratulated for his positive contribution”.
A brilliant party machinist, Mantach was now a coveted Victorian Liberal. Finally in the centre of power, he was rubbing shoulders with premiers and befriending the future prime minister Tony Abbott.
He would go on to become the director for four consecutive years. At the top of his game, he wrote to the party faithful: “We all witnessed the magnificent victory by Ted Baillieu [2010 Victorian state election]. It has been great to see honest, accountable and responsible government … We are upgrading our membership system to new management system that will make your interactions with the Secretariat quicker and easier and more responsive to your needs.”
But behind the scenes, a large-scale cover-up at the highest levels allowed a con-artist and criminal to set up an embezzlement scheme worthy of the Panama Papers.
What grassroots Victorian members did not know at the time was that Mantach had been “moved on” to Victoria because of his personal spending of $48,000 on the Tasmanian Liberal credit card.
Then, in 2013, there were further warning signs with another cover-up: the Liberals and the Independent Broad-based Anti-corruption Commission cleared Mantach over bribes he authorised to a former Liberal staffer implicated in the Police Minister scandal, which forced the resignation of a premier.
Chum Tony Abbott backed the party boss saying, “I know Damien Mantach well. He is a person of integrity, so let's see where this investigation goes. He has my confidence.”
As the Liberal party machine fizzled out with the 2014 Victorian election loss, the full extent of Mantach crimes were exposed. A 2015 internal Liberal audit showed that Mantach had embezzled $1.55 million using shell companies to fund a laissez-faire lifestyle of shares, cafe ownership and a seaside home.
The fall from grace was as swift as the rise to the top. In early July Mantach was sentenced to five years' jail with parole after two years and eight months. The verdict seemingly ended one of the more remarkable political fraud scandals and cover-ups in Australian political history.
Liberal Party power structures maintain — and the mainstream media agrees — that the case is a lone-wolf-come-bad-apple scenario.
But a Green Left Weekly investigation can reveal, in chronological order, the high-level cover-up and protection of Mantach and possible federal party fraud.
In 2005, the Liberal Party covered up Mantach's role in hateful anti-gay ads and electoral fraud by the Exclusive Brethren religious cult.
Mantach insisted there was “no cooperation” between the party and the Brethren over the ads, which ran in local newspapers in the 2006 Tasmanian election campaign, targetting the Greens and claiming the party's policies on transgender and intersex people would “destroy families and society”.
Documents released in January 2007 showed that Mantach had arranged for Liberal Party staff to transfer the text to electronic format, vetted the ads for compliance with the electoral laws and forwarded them to its advertising agency. The ads were billed by three separate newspapers to an advertising account held by the Liberal Party.
In 2008, former Tasmanian Liberal Party president Dale Archer advised then party federal director Brian Loughnane of the fraud case surrounding Mantach's exit as Tasmanian state director. Senator Eric Abetz was also fully informed of the credit card fraud.
Also aware of the fraud was Tasmanian Speaker Elise Archer, who was married to former party president Dale Archer. Archer was, at the time, in charge of Mantach's employment.
But there was no formal, on the record investigation. Liberal hollow men preferred to cover up the Tasmania fraud. But Mantach's resignation was obtained and the $48,000 was repaid in installments.
Effectively gaining a promotion, Mantach carried a good name and Liberal references over to the Victorian job and in 2011 he became director of the Victorian party.
In 2013, Premier Baillieu resigned over the Mantach bribe and police scandal. But backed by Abbott, Loughnane and new premier Dennis Napthine Mantach stayed on as director.
In December 2014, businessperson and Liberal Party Treasurer Phil Higginson was forced out as party treasurer after accusing the party of financial dishonesty and alleging conflicts of interest involving Prime Minister Abbott's chief of staff Peta Credlin and her husband Loughnane, for withholding receipts and billings. He has since called for a forensic audit of all Liberal Party branches across Australia.
Late last year an audit uncovered a $1.55 million fraud. Mantach had paid himself the money by creating a fake business, Parkstreet Online Solutions, which purported to offer IT and social media services to the party.
Mantach was charged and found to have spent $1.55 million on Gusto Cafe, owned by Mantach's wife; shares; motor vehicles; and home loan repayments. At his trial in early July, Mantach blamed troubles in his marriage, the number of hours he worked and said the Liberals were combative and nasty. In sentencing, the judge said he took into account Mantach's issues with the Liberals, as well as his gambling, drinking and family problems.
A federal police investigation continues and expects further charges to be laid. The Victorian Liberal Party has repaid $200,000 to the Victorian state after it was discovered Mantach had received kickbacks from a printing company, which then overcharged state and federal MPs for their parliamentary printing entitlements.
Mantach's printing scam is eerily similar to the Parakeelia scandal. Parakeelia was established in 1989 as a wholly Liberal Party-owned software development company. Its director is Loughnane. It apparently provides data collection software to Liberal and National MPs, for which the MPs give Parakeelia their $2500 annual parliamentary software entitlement. Parakeelia then donates money to the Liberal Party, to the tune of $2.5 million since 2008, including $500,000 last financial year.
The aftermath of these scandals has been brutal for the Liberals. Liberal donors in Tasmania, Victoria and NSW withdrew their funds due to the fraud and cover-up. Senior Victorian Liberals now admit the Mantach embezzlement starved the machine of funding at the recent state and federal elections. Tasmanian Liberals lay blame for their federal election wipeout on the revelations of the credit card fraud cover-up.
The Liberal Party is broke. It recently took out a $2 million bank overdraft using its Melbourne headquarters as collateral. NSW held back $4.4 million from the party due to the donation fraud disclosure. The $1 million donation by Malcolm Turnbull to the Liberal election fund suggests its in-house financial management is in tatters.
As the forensic accountants PPB Advisory and former Liberal Treasurer Higginson discovered, the Liberal Party has failed its own lofty standards. The party of the free market has no judiciary capacity, no standing audit committee. Moreover, the party of law and order has been all but silent on the two year sentence given to Mantach.
As for Mantach, he is rehabilitating in a low security country jail and, according to court documents, is educating prisoners in the art of politics. Hopefully, they do not go home with any bad habits.