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The idiot's guide to understanding the conflict of interest case against Gillard

The issue

Wilson had banked cheques made out to the AWU into a private, non AWU account.   He did it in secret.  And he got outsmarted and caught.  He was facing internal AWU charges and criminal charges.


Between December 1994 and July 1995.

How much money?

About $160K

What Gillard told her partners two months later

11 September, 1995

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Bernard Murphy states:

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The documents here show Slater and Gordon had been advising Wilson on the transitional matters associated with the handover to Smith starting at the latest from December, 1994.  They'd been through thick and thin since 1991 too including the establishment of the AWU Workplace Reform Association etc.

It appears that Wilson raised his hand and admitted his defalcations to his lawyers around 14 July 1995 after the AWU Members Welfare Association account was frozen.   He was cactus - and so are they.

From the evidence of Murphy and Gillard, he "gave instructions" about the allegations first to Gillard and then to Wilson in about July of 1995.

What does taking instruction mean?

In order to act for someone, a lawyer has to understand what the client is up against so far as allegations/evidence etc is concerned.

In this case the allegation was simple.   Bob Smith alleged Wilson had banked AWU funds into a non-AWU account.

At some point a conversation between Gillard and Wilson in similar terms to the following must have taken place.   Gillard did not create a written retainer, nor did Murphy on the matter.

Gillard, "What account is involved?" (holds breath and looks away)

Wilson,   "It's called the Australian Workers' Union Members Welfare Association".

Gillard    (sigh of relief)      "I'll have to have a look at the statements please plus any other banking information you have, copies of cheques, invoices etc."


Wilson should have had no difficulty with that.   He'd sent that information to Bob Smith - this from Smith's statement to the TURC.

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Gillard would have quickly discovered there were only 5 companies involved.

  • Thiess
  • John Holland
  • Chambers Consulting
  • Fluor Daniel
  • Phillips Fox Lawyers (acting for Woodside Petroleum)

Of those 5 companies, there were 10 transactions to ask questions about

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Thiess, a major employer and party to EBAs with Wilson's branches of the AWU was first on the list.   Thiess would have been well known to Gillard.   Her best friend Robyn McLeod was a director of the Board of a Thiess superannuation company along with her boyfriend, lover and client Wilson.   McLeod was working in the Melbourne Water element of the AWU representing the all Thiess workforce.

Wilson was now in the bare-all stage.   He had no choice - Bob Smith had dacked him by exposing the details of the dodgy bank account.

Wilson's instructions to his lawyers are currently secret, however even cursory analysis of the barest of details for the Thiess payment of $20,160 would have alerted Gillard to this:

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There were only two Thiess transactions to "take instructions" about.

Gillard, "May I look at the bank statement please".

Wilson, "Sure, here's the first page, you'll note two entries for cheques in October - each for $8750, summing to $17500.   Sound familiar, 50% down and 50% on completion?  They went to Town Mode Fashion also the owners of the Kew building company which may be familiar to you Julia..  Any questions?"

Gillard, "None at all."

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Wilson, "Here's the first Thiess pay-in, $31,00 on 22 December 1994"

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Gilard, "Right, and those $213 regular payments in, what are they?"

Wilson, "Payroll deductions for a re-election fund.   You will see that this is an unincorporated association.   We had found that using an unincorporated association continues to stand the test of .........oh never mind.  They are clearly private monies.   Here's the next page."

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Gillard, "$6,000 went out on 22 Feb, what was that about?"

Wilson, "A cash cheque.   Most of them are, unless I want someone in the shit".

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Gillard, "Dodgy handwriting - big night?" (checks diary)

Bruce hands the next page.

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Gillard, "Well a few highlights there, 6 April $6500, what's that about?"

Wilson, "That was smoking the peace pipe with Bob Kernohan - keep your friends close and your enemies closer.   There's something on everyone, remember it's in our DNA.    I don't think Bob will be making too much noise once he realises where his expense reimbursement came from."

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Gillard, "Good, he'll crumble in two minutes, Bill will offer him a seat in the upper house and he'll be pissing on and out of the way.   And $15 grand on 27 April, just a few weeks ago, how about that - don't tell me it's cash too!"

Wilson, 'No, well sort of cash but cash for a specific purpose.   We'd,  sorry, I'd shut down the Workplace Reform Association earlier in April.   You'll remember Kon Spyridis I'm sure.  Well he needed $10 grand, and I needed $5 grand to hand to Wayne Hem to deposit into ......... an account of someone whose identity is legally privileged and confidential."

Gillard, "Thank God for British justice."

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Gillard, "Is there much more?'

Wilson, "On the pay in side there's $19,000 per quarter from Woodside and you can see the deposit slips for all the companies here".

(points to banking information maintained by the archivist Wayne Hem) 

Gillard, "Holy Shit Bruce.   I perceive I may have a conflict of interest here.   I will have to do the right thing consistent with my duty of utmost good faith and timely disclosure to my partners, especially having regard to the mechanism for you converting these cheques made out to the Australian Workers Union into funds privately controlled by you - that being the use of an entity capable of opening and operating a bank account with the name "Australian Workers Union" in the title.   In regard to my duty of timely disclosure to my partners - well obviously I'll need some time to think about that and see what's going to come out anyway.  Further, I am a fiduciary to the Australian Workers Union and you have disclosed to me what on the face of it appears to be fraud on the AWU.   I will have to think up a form of words to describe shall I put it Bruce...

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Gillard, "Now Bruce, is there any link between this AWU Members Welfare Association and any other unauthorised account bearing the name AWU?"

Wilson, "Do you mean unauthorised as in no Resolution of the Executive or unauthorised as in behind Bill Ludwig's back?"

Gillard, "Don't be smart Bruce, this is serious."

Wilson, "Do you think I've been planning to go down alone?   There was this thing called AWU Workplace Reform Association that you have forgotten about, I was given some urgent advice about that in April when things started heating up as you might recall.   It's shut down so it's obliterated.   But you might not like the next page of the bank statement".

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Gillard, "That doesn't look too bad, what's the 13 July pay in for $54,600 about?"

Wilson, "Oh that.   Money burns a hole in my pocket.   After I shut down that AWU Workplace Reform Association account...........there was this cheque getting lazy, so I put it to work."

Gillard, "What was the cheque?"

Wilson, "A bit unmistakable really.  You know at this late stage, I just thought it might be a bit of insurance if my lawyers knew they had skin in the game too.   So I banked it.  Evidence that we are all in this together - just so I know we're all really trying!   It's made out to the Australian Workers Union Workplace Reform Association Incorporated in answer to an invoice from the said entity.  Remember the one I took advice about, the one to receive funds from the Dawesville project?   But don't worry too much, you're in good company, just ask Bill.'

Gillard, "For f**k's sakes Bruce.   Any more good news?'

Wilson, "Yes.   I am well and truly sprung now, read this letter I just received'.

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Gillard, "What's this about?"

Wilson, "Well, I knew Bob Smith was on my tail.  I had to clear the AWU Members Welfare Association account out in a hurry - I got close, but no cigar.   That prick Bob Smith outsmarted me, he got to the bank and had them freeze the account on the day I wrote this cheque to empty it.   The bank bounced it because of Smith and your mates at Maurice Blackburn."

Gillard, "John Cain.   This much talent (holds up little finger).  I'll bet poxy Roxy...oh nothing"

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Gillard, "Anyone else know about this?"

Wilson, "Yeah, Wayne Hem.  I got him to do all the banking, including the odd $5 grand to a damsel in  distress.   You know he's got a photographic memory - remembers details like account numbers and stuff.   I could have done it myself, but then.......Call it insurance."

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Gillard, "I am going to have to get Bernard to take instructions in this now Bruce.   Is there anything I should know about this Construction Industry Fund as I properly and diligently take instructions from you in this matter - having due regard to my duty to my partners, the law and my position as a fiduciary to the AWU?"

Wilson, "Well there is a bit of an unfortunate paper trail, yeah.   That account, the National Construction Fund, the one I tried to empty the grand into.   Well it was set up in February this year. It's one signature to operate it.  Maria at the CBA....well that's another story.  Now, when you said to.......sorry, when it became a pressing imperative to cease the operations of the Australian Workers Union Workplace Reform Association I had to find a home for the $40 grand in it.   So I got Ralph to dump it into the National Construction Fund.  Here's the statement - do you reckon anyone will notice the link to your..sorry our Workplace Reform Association?"

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Gillard, "Depends.   Now giving you unconflicted advice in my role as a fiduciary to the AWU I have to hope they do.   Now in relation to my unconflicted duty to you as my client and having regard to the intermingling of our financial resources I hope that imbecile, stooge, user of ASIAN prostitutes (PAUSE FOR EFFECT) and sophisticated property investor Ralph Blewitt learnt something about writing out C-A-S-H cheques from the Kerr Street experience.   I hope that little matter - the one I've been living in while my renovations were being done - the one I have no recollection about.   Bruce, what's that look on your face?.......Bruce........BRUCE..........BRUCE!!!!!!"

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Wilson, "Well it's hard to get good help".

Gillard, "Bruce I will have to partially cease acting for you because of my undiscovered conflict of shall I later put it???

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After a time, well a couple of times at the Windsor.

Gillard, "You know Bruce, one of us better become PM so we can tell the Attorney General to "find something for Bernard".   Oh God, imagine Nicola as AG!   Or shit-in-his-pants-Shorten in parliament.   One thing's for sure, Ian "If-Cambridge-Isn't-Stopped-We're-History" Cambridge has got that freak Robert McClelland acting for him.  Imagine him as AG, I'd fix him up".

Wilson, "I know, but nothing will ever get in the way of our love for each other darling.   For better or worse hey."

Gillard, "Worse?   How could it be worse.   There's only one hope now Bruce - today's High Court Judge is tomorrow's Royal Commissioner.   What have we got on............"



PS - I am so over filling my waking hours with seemingly endless hours of comparing documents, digging, thinking, analysing, writing and otherwise being infected by this sordid business.   Complexity is their friend.   So is time "this all happened so long ago" etc.    The manual must read

  • make it complex
  • buy time then buy more time - get past deadlines like the end of a Royal Commission
  • announce your own enquiry on your own terms
  • always act through a lawyer to get privileged confidential status on document
  • always act through a fall-guy - be disciplined about it
  • watch your handwriting, don't write on documents if you don't have to
  • have something on everyone - but know the reverse applies
  • have reliable access to the favour bank - mates who can offer jobs
  • have reliable access to the Kenny Splash-Down tanker with 2 stroke pump, large bore hose and plenty of juice - that means mates in the media to run disparaging stories      
  • show the enemy the instruments of torture early then bucket and discredit without mercy


So why do it?   Bill Ludwig had something on Gillard and he installed her as Prime Minister.   That's where this all leads.

In the meantime, until we get there I have to admit to wishing I didn't understand it at all.