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Philomena O’Grady: Family Court: fraud the social, economic, political and national security “black elephant” that Australian politicians have refuse

 

Family Court: fraud the social, economic, political and national security “black elephant” that Australian politicians have refuse to tackle and enforcement agencies refused to prosecute

“The liberties of none are safe unless the liberties of all are protected”

William O Douglas
Former Associate Justice of the U.S. Supreme Court

Since the Family Law Act was enacted in 1975, there has been a reluctance by governments, ministers, politicians, enforcement agencies, court bureaucrats, lawyers and social workers to address decades of systemic corruption, brought about by the Acts “secrecy provisions”.

The intention of the article is to focus on the failures of the Family Court processes in addressing issues of financial integrity.

Legal and regulatory frameworks supporting socially accepted norms of good governance, as well as ethical and honest practices reinforcing and supporting the family structure have been lost.  In their wake we have witnessed the growth of an industry where systemic governance failures and unethical practices have continued to operate under a shroud of secrecy and have flourished as a result of Government failures to address decades of complaints.

The Australian Law Reform Commission’s (ALRC) Review into the Family Law System tabled in Parliament in April 2019 was provided with submissions highlighting the extent of the problem.  A fragmented family court system has allowed systemic corruption to flourish destroying families, alienating parents and denying children the right to a nurturing and loving family.  There are no winners, as those placing their trust in lawyers are held to ransom by a small proportion of the profession.  Unethical and unscrupulous practices, have resulted in exorbitant legal costs, some of which routinely exceeded $300,000 with some even skyrocketing to over $1 million.  It was recently stated that “as the family court system falls apart, all of the unethical, unscrupulous, bottom-feeding lawyers converge to extract money from the carnage.”

The problem is that many are being stripped of their assets not only due to unscrupulous practices, but also as a result of many lawyers working within this specialized area failing to have the proper financial expertise.

The ability to forensically analyze financial data to ensure its accuracy is an essential component and becomes even more relevant in instances when dealing with financial settlements.  Without the appropriate qualifications financial statements submitted to the court are often incorrectly assessed and often contain fictious financial data, resulting in incorrect asset disbursements and failure to identify assets that have not been disclosed.

As the issue had wide ranging ramifications, the matter was raised with numerous Federal Ministers, State and Federal politicians and was also the subject of a submission to Victorian Royal Commission into Family Violence in 2014.

Despite becoming aware of the issue, was nothing done to either address the competency and expertise of those undertaking financial settlements or, advise the Australian public that many lawyers undertaking financial settlements failed to have the appropriate financial, analytical and investigative skills to do so.  The ALRC also raised the issue of “…What qualifications and training should be required for family dispute resolution practitioners in relation to family law disputes involving property and financial issues?”

Possessing proper forensic accounting or investigative qualifications should be mandatory, especially as fraud methodologies may vary from to very simple to complex.  Examples of these include, forging a signature to obtain loan in another parties’ name or undervaluing assets on financial statements in order to obtain a financial advantage from the proceedings, with more complex methodologies possibly involving asset shifting between company structures.  Invariably, the aim remains the same, to obscure the true sum of the asset pool to the advantage of one of the parties at the expense of the other.

Another methodology are cases where lawyers fail to undertake proper verification of identities prior to lodging documents.  There have been instances over the past few decades where these failures have resulted in the lodgment of bank accounts in multiple identities.

Case Study

Upon receiving details in relation to a particular case, lawyers were dismissive of information and of the evidence which highlighted multiple identities, including the operation of bank accounts in multiple identities.

Of concern was their inability to comprehend that variations in the spelling of names needed to be fully investigated as to the rationale of the variation.  Take for example bank accounts in the spelling variation of STEVEN / STEPHEN.  Would this be considered one identity or two?

In instances such as these, common practice dictates that scrutiny of primary source documents is warranted in order to ascertain why the spelling variation has occurred.  However, in this case checks of primary source documents were not undertaken and the discrepancy in spelling of the names on the bank accounts were explained as being a “typographical error.

The information and evidence in relation to the multiple identities was also provided to the bank involved.

In the Bank’s attempts to conceal the multiple accounts, the Bank advised that the matter was under investigation; however, they failed to mention that the investigation was undertaken internally.  They also advised the details of the matter were to remain confidential.  These advices resulted in financial losses due to the complainant’s inability to contest undisclosed assets and the issue of the multiple identities which had also failed to be addressed by lawyers involved in the case.

More important is the question of whether the Bank lodged a Suspect Matter Report (SMR), or were the Bank’s actions guided by a belief that the matter would never surface due to the Act’s “secrecy provisions”?

The banks’ decision to involve itself in family settlement matters is deeply concerning.  The bank had not only crossed the line in involving itself in a settlement matter by providing advice, but also may have failed to comply with “Know Your Customer” provisions of the Anti-Money Laundering/Counter Terrorism Financing Act (AML/CTF).  If this is one case, how many other complaints addressing similar issues have been concealed by the bank in question and at what cost to families, the wider community?

In 2014, given the extent of the negligence the complainant lodged a complaint with the CEO of the Family Court.

The complaint was responded to by the Court Registrar who advised that the Registrar was mandated under subsection 12(3AB) of the Federal Circuit Court of Australia Act 1999 to assist the Court in the handling of complaints, including making a range of decisions about complaints.

It appears from the Court Registrars response, that there are serious failures within the Family Court system to grasp the strategic ramifications of the issues raised by the case.  It also highlights the Family Courts fragmented system and the difficulty in getting any complaint investigated and prosecuted and Australia’s commitment to Rule of Law.

Whilst Rule of Law has no single agreed definition, it is defined as a set of principals which have been developed in accordance with internationally accepted standards.  The acceptance of these principles are listed on the Attorney-General’s website and highlight that Rule of Law underpins the way in which Australian society is governed.

Complaints made to State and Federal Ministers and politicians across the various political spectrums were disregarded as were requests for meetings with numerous State and Federal Ministers.  The complainant also provided enforcement agencies with evidence highlighting fraudulent conduct, bank accounts operating in multiple identities and evidence relating to numerous other federal offences that had had been identified, but these were also ignored. Why?

Although such complaints are viewed as isolated incidences, they form part of a bigger systemic problem that over the decades have affected thousands of families and their children.  Many complainants are ridiculed, bullied, intimidated, victimized and labeled as having “mental health” issues by politicians, lawyers, bureaucrats and at times advocates for continuing to highlight Rule of Law failures within a system that has destroyed their lives, the lives of their children and occasionally their relationships with extended families.

The exact rationale for Government failing to address decades of complaints remains unclear.  Ironically, whilst acknowledging the detrimental and intergenerational social and economic effects of domestic violence, political expediency has failed to acknowledge the intergenerational social and economic harms inflicted on families by a Court system that has for decades failed to comply with Rule of Law principles and acted in isolation rather than acting holistically for the benefit of the wider community.

There is no rational explanation as why complainants are ignored especially if they are raising legislative failures which have resulted in poverty.  One possible explanation could be decades of conditioning by “spin doctors” and the accepted perception that family matters are “private” are therefore not open for public discussion.  Wasn’t this perception used to keep victims of domestic violence silenced and human rights abuses suffered by them concealed for decades?

Whilst there are circumstances where these provisions may be beneficial, “secrecy provisions” are detrimental in instances where equitable financial settlement has been denied due to fraudulent practices which Government, Family Court and enforcement agencies fail to address.  Each agency passing responsibility for accountability to next agency, and the merry go round continues without proper scrutiny of the underlying issues which is detrimental to our community.

In the past complainants were viewed as “vindictive”, however as more and more victims are speaking out there is a growing anger within the community as to how complainants and their families have been treated.  Systemic human rights abuse once concealed from public discussion are now being openly discussed as a result of negligence which has caused decades of families to be pulled apart and destroyed.

One of the important facets of “secrecy” within a democracy remains accountability.  When Governments unlawfully exceed or ignore lawful constraints of power and dominion placed upon their exercise of power and dominion by a country’s Constitution and evolve into an unlawful tyranny failing to comply with Rule of Law and engaging in systematically violating Common Law Rights, citizens have both a Right and a Duty to speak out.   On this point J.S. Mills succinctly stated: –

“…..as soon as any part of a persons conduct affects prejudicially the interests of others, society has jurisdiction over it, and the question whether the general welfare will or will not be promoted by interfering with it becomes open to discussion….”

and

“That the only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others”

Accountability ensuring the openness of government to account for its actions, policies and administrative decisions remains a vital component that safeguards against the abuse of power by the state and remains one of the key principles of Rule of Law.

Decades of concealment under the Act “secrecy provisions” has contributed to the destruction of family dynamics leaving many either in poverty or loosing their families due to the negligence, incompetence and systemic intimidatory tactics aimed at procuring financial settlement under duress whilst concealing the true financial nature of asset pools.  In order to rectify the situation, the ALRC has recommended that complainants be given access to courts for matters involving complex asset pools and/or complex ownership structures where non-disclosure or fraud has been alleged.   However these are only recommendations and may take years to implement.

The fact that lawyers undertaking financial settlements can do so without having the appropriate forensic accounting or investigative qualifications and the use of “secrecy provisions” to conceal offences can no longer be ignored, nor can such cases be viewed in isolation.  To do so would be to ignore the intergenerational social and economic consequences that encroaches on Australia’s National Security framework.  The ongoing intergenerational cost to Australian families and the community in general may be just as significant or perhaps exceedingly more than the total cost of domestic violence.

There is growing community anger at the level of deceit, concealment and corruption by negligent, incompetent, unethical and unscrupulous practices as fraudulent practices within the Family Court setting have flourished under the watchful eyes of successive Governments, politicians and bureaucrats, all failing to ensure compliance with Rule of Law in order to protect those that entrusted a legal system to assist broker equitable financial settlements.

Government can no longer ignore the Family Court “black elephant”.  Whilst Australia has ratified both the UN International Covenants of Civil and Political Rights and the UN Conventions on the Rights of the Child, Australia’s ongoing failure to comply with Rule of Law within a Family Court setting has left many in poverty, destroyed families, led to a myriad of human rights abuses and suicides of parents and children.  These practices are both deplorable and unjustifiable and should be the subject of a UN Human Rights investigation.

Finally, I dedicate this article to the countless thousands of parents and their children who have over the decades, suffered human rights abuses, had families torn apart or lost family members through suicide as a result of a toxic system which successive Government have refused to address.  Australia’s children deserve a better future, a future inclusive of parents who love, nurture, guide and support them through life’s amazing journey.

Family Law Act 1975 Section 121.

Australian Law Reform Commission “Australian Law Reform Commission Family Law for the Future – An Inquiry into the Family Law System” ALRC Report 135, Question 10.2 March 2019 p.508

Bita. N “Divorce debs in sights – Family Court Review” The Herald Sun 30 June 2019, p.23

Davidson, H. “Obscenely high: how family court costs are destroying parents and their children” The Guardian, 19 December 2017.

ALRC Report 135, Question 10.2 March 2019 p.508

Letter to CEO of Family Court dated 24 November 2014

Letter to dated 22 January 2015 (11564/2008)

World Justice Project “What is Rule of Law” https://worldjusticeproject.org/about-us/overview/what-rule-law

Four principles include:-

Accountability – The Government as well as the private sector actors are accountable under the law.

Just Law – The laws are clear, publicized, stable and just; are applied evenly; and protect fundamental rights, including the security of persons and property and certain core human rights.

Open Government – The process by which the laws are enacted, administered, and enforced are accessible, fair and efficient.

Accessible & Impartial Dispute Resolutions – Justice is delivered timely by competent, ethical, and independent representatives and neutrals who are accessible, have adequate resources, and reflect the makeup of communities they serve.

Attorney-General’s Department Rule of Law https://www.ag.gov.au/About/Pages/Ruleoflaw.aspx

Laschon, E. “Australia has spent over $700 million to curb domestic violence – but it is unclear if it’s is working” ABC News 14 June 2019

ALRC Report 135 March 2019, Recommendation 8.57, p.260

Australian Law Reform Commission “Review of Secrecy Laws – Discussion Paper 74” Open Government, Secrecy and Public Interest” Chapter 2, p.52 June 2009.

Mill, J. S. “On Liberty” Pengiun Books Ltd 1974 p.141

Mill, J. S. “On Liberty” Penguin Books Ltd 1974 p.68

ALRC Discussion Paper 74 Chapter 2, June 2009, p.52.

ALRC Report 135 March 2019, Recommendation 8.57, p.260.

 

 

Download report alrc_report_135

By

 

Bio

 

Philomena O’Grady is a Forensic Criminologist specializing in AML/CTF and Rule of Law and Human Rights Advocate.

During the past decade Philomena has continued to raise awareness of the National / Regional / International security ramifications emanating from decades of systemic AML/CTF failures within Australia’s financial markets.  Philomena is also raising awareness of the intergenerational social and economic consequences of Rule of Law failures and breaches of AML/CTF legislation occurring within Australia’s Family Court and Child Support Agency.

Philomena has been published Internationally and has over the past decade has made valuable contributions in the area of AML/CTF failures, risk, compliance and corruption and her expertise has seen her present at numerous global Conferences

Philomena holds numerous degrees including Master of Criminological Studies, Master of Policing, Intelligence and Counter Terrorism, and Master of International Security Studies.

 

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