‘Everyone eats’: Secret audio lays bare CFMEU kickback plan

An undercover sting operation has caught a self-styled CFMEU fixer offering to bribe construction union officials to push corrupt building firms onto large taxpayer-funded projects.

In explosive recordings that will step up pressure on Labor to clean up the construction union, business consultant Harry Korras claimed he could funnel large cash payments and regular kickbacks to his good “friends” in the CFMEU.

In return, he said the union would push favoured firms onto construction sites involved in Victoria’s $100 billion Big Build program, which has funding from the state and federal governments.

Korras explained the illicit payments were necessary because his long-standing union contacts needed “to eat” their piece of contracts won by firms that obtained CFMEU backing through his scheme.

In a separate damning development, a major investigation by this masthead and 60 Minutes can also reveal Derek Christopher, the Victorian CFMEU boss positioning to replace John Setka as leader of the union’s most powerful branch, received an estimated $200,000 in free labour and supplies from major building companies and remains the subject of an ongoing police corruption probe.

Three sources with detailed knowledge of Christopher’s conduct, along with confidential documents revealing his dealings, have exposed how he personally benefited from labour and supplies provided over several months in 2017 by commercial building giants Built and Multiplex, and plastering firm Express Interiors.

Express Interiors has been separately implicated in the underpayment of building workers.

A Victoria Police spokesperson said in a statement that a joint federal and state police inquiry, codenamed Operation Pantile, into Christopher remained “active and ongoing”.

In NSW, pressure is growing on CFMEU secretary Darren Greenfield to step aside from his role leading the construction union until his criminal court case – involving allegations he was bribed by a Sydney company in return for union support – is resolved.

The charges, laid by federal police in 2021, have not been proven and are entirely separate to Christopher’s case, but CFMEU manufacturing division assistant secretary Leo Skourdoumbis said Greenfield should stand down as secretary until his case was concluded.

“The charges are serious and people in positions of leadership, whether they’re in the trade union movement or even in the corporate world, when those situations arise [involving criminal charges] should not continue to hold and exercise power,” he said.

There is no suggestion that Greenfield is guilty, only that it is unusual for the leader of an organisation to stay in the role after being charged with corruption.

The CFMEU’s construction division is facing a growing crisis amid explosive revelations of its links to the underworld, bikie gangs and alleged corruption.

On Sunday, federal Workplace Relations Minister Tony Burke said it was “unacceptable” that bikies would hold positions of authority in a union.

He told the ABC that he had asked his department for an assessment of his options to clean up the union, including deregistration, but said he would assess the union’s response before deciding on his next step.

Heir apparent

Christopher has in recent months been unofficially anointed by Setka – who sensationally quit the union on Friday night after facing questions from this masthead – to replace him as leader of the CFMEU’s most powerful branch.

Evidence gathered by Operation Pantile includes vision from a concealed video camera that recorded workers from some of Victoria’s biggest building firms repeatedly attending Christopher’s house during its renovation. The firms do not engage in residential renovations.

Australian Taxation Office data obtained by Operation Pantile details how workers covertly filmed by police at Christopher’s renovation site were simultaneously being paid by commercial builders to ostensibly work on major building sites — and not on Christopher’s residential job.

Phone taps and listening device recordings also captured evidence suggesting Christopher had arranged for free labour and supplies from major building firms with CFMEU agreements and also used CFMEU delegates on commercial building sites to assist with his home renovation.

This masthead has also confirmed that law enforcement intelligence indicates Christopher attempted to cover up his conduct by creating invoices after a police raid on his property in 2019.

This masthead previously revealed the raid. However, details of the free benefits he obtained and the companies that gave them have not previously been reported.

Built said it had “fully co-operated” with the police investigation and Multiplex declined to comment. Express Interiors did not respond to requests for comment.

One source, speaking anonymously to discuss confidential information, said the CFMEU conducted an internal investigation into the claims at the time of the police raid but found no wrongdoing.

But the belief of many within the union that the investigation into Christopher – who did not respond to questions – was no longer active will be shattered by the police confirmation it remains live and legal advice is being sought about whether the union boss can be charged under Victoria’s criminal code.

There is no suggestion from this masthead that Christopher is guilty of an offence, a finding that can only be made by a court.

SECRET FUNNEL FOR UNION CONTRACTS

The revelations about Christopher’s suspected kickbacks come after a major investigation by this masthead and 60 Minutes obtained audio of self-styled CFMEU fixer Harry Korras describing a plan to separately funnel secret benefits to his own union contacts.

Korras, a colourful former security company owner with underworld connections, was convicted of tax evasion in 2019.

This masthead and 60 Minutes launched the sting operation in March after gathering information from building industry insiders that Korras was offering to help companies secure union backing and access to big construction projects in return for large payments.

An undercover operative – who told Korras they were the owner of a new firm seeking CFMEU support to win contracts to supply traffic-management workers to construction sites – approached Korras to ask about obtaining union backing.

The CFMEU tightly controls the entry of labour hire and traffic-management companies into the industry, only agreeing to union-backed enterprise bargaining agreements (EBAs) with certain firms and pushing those preferred companies onto some of the state’s most lucrative construction sites.

On Saturday, this masthead revealed how those who had served as the leaders of bikie gangs, along with other underworld figures, had infiltrated CFMEU ranks and, in some cases, Labor government projects in Victoria and NSW, using preferential union treatment to profit.

On Sunday, this masthead revealed Setka’s personal role in intimidating a fellow union leader, as well as covert video of a senior union organiser threatening to bash building company owners working on the Big Build.

Korras told the undercover operative in a meeting in an office in Coburg in Melbourne’s north that the CFMEU was extending its control over the Big Build, the Victorian government’s signature infrastructure agenda, by using its industrial muscle.

Korras also said the CFMEU had weaponised union-endorsed EBAs – which are used in workplaces to lock in pay and conditions – to enable the union to control which companies could win contracts.

“You would know now that the biggest union is CFMEU. And they’re very clever in how they do business,” Korras said. “And, they don’t give out EBAs that easy. And, the reason why is because they control the market.”

‘There’s a fee to get the EBA. That’s business. And everybody eats.’

Harry Korras

Korras said the union had ramped up its control of the construction sector, claiming the “CFMEU is torturing everything” to dictate which sub-contractors could gain access to the Big Build.

“They’re going for everything. The Big Build is theirs. You can’t get in if you don’t know someone. Not gonna happen.”

Korras explained he had deep contacts inside the union who would provide behind-the-scenes assistance in forcing a company out of the Big Build and replacing it with a new firm. To do so would require a kickback.

“I have a 30-year relationship with the union. I have a very good relationship with them,” he said.

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“So the bosses are all my friends. We all grew up together,” he said of unnamed CFMEU union officials. “I will take this to them. They’re going to ask me two questions. One, why am I helping you? And two, they want to eat. So there’s a fee to get the EBA. That’s business. And everybody eats.”

Korras said a kickback would secure the access.

“They look at the Big Build … they look at it and say, ‘All right, let’s put [your new traffic management firm] here’.

“So they’re going to say to you, ‘This is yours’. But to put you there, they have to move someone. That’s business. And everybody eats.”

Asked whether “everybody gets a share”, Korras confirmed this needed to happen “to make it fair for everyone”.

Korras then explained that the first payment from a new company to get union support involved cash, giving the example of a scaffolding company that had paid $100,000 upfront to win work on a state government project.

“That job there cost them $100,000 to get in. But, mate, they’re making, I can’t tell you how much.”

Korras said that after the initial payment, which he believed was paid in cash, companies needed to pay an ongoing kickback from every dollar they earned on a site.

But Korras explained that this cost was absorbed in the bills sent to the lead contractor, which on Big Build projects is ultimately publicly funded.

“The good thing is, it doesn’t cost you. It’s in your rate [that you are paid by the lead contractor].

“So they’ll say to you, I’m saying as an example, ‘[new company], it’s a $100 an hour. The boys need to be paid $60. You keep $20’.”

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Korras said “the rest”, or one-fifth of every dollar paid to the new traffic firm, would be paid as a kickback so “everybody eats”.

He said the kickback money would be paid via a consulting firm.

“A company gives you an invoice, ‘professional consulting’,” he said.

Near the end of the discussion, Korras said he would organise a meeting between the CFMEU and the new traffic-management company. Asked if the union would ask for money during this meeting, Korras said the request would be made prior.

“They’ll tell me beforehand.”

The meeting never took place.

Korras’ comments recorded on tape contrast with his strong denials to this masthead that he had ever arranged CFMEU agreements in return for union payments. He said he “didn’t have a clue” about the building industry.

Asked by this masthead if he ever helped a company get a CFMEU EBA in return for union kickbacks or payments, Korras said: “Absolutely not”.

“I’m not involved in anything of such, or unions or anything. I’m not involved in that industry. That’s absolute garbage,” he said.

He said he had “never met the union, [was] not involved with the union. That’s totally not true.

“I probably got ex-guards that worked in there [in the CFMEU] or are working there, but I don’t catch up with them and talk about the building [industry]. I wouldn’t have a clue.”

In a statement, the CFMEU said it had no evidence that any official had ever received a payment from companies that had signed EBAs.

“Anyone proven to have engaged in that conduct has no place in the CFMEU,” it said.

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