CAIRNS CITY, Queensland, Australia–A credit union here is alleging its former CEO awarded more than $2 million in unnecessary, “uncommercial” contracts to companies, including one that was owned by his wife.
Documents filed in Queensland Supreme Court by Coffs Harbour-based credit union BCU allege the former CEO, Lyndon Kingston, oversaw the awarding of those contracts, according to Yahoo Finance, citing an Australia Broadcasting Corp. (ABC) report. The suit further alleges Kingston offered his wife $345,000 in a “sham redundancy,” according to the ABC report.
“The former credit union CEO allegedly awarded unauthorized contracts to the tune of $2.5 million to six companies, and accepted secret commissions from two of them,” ABC reported. “One of these six companies was ‘Sparkle Consulting’, owned by Kingston’s wife.”
‘Reward’ Allegedly Offered
According to the ABC report, the court documents filed by BCU allege that another company paid him a “reward” of $10,000 for the contract, which then went to Kingston’s family trust.
He also allegedly used the services of an accountant to bill BCU for personal tax advice, ABC News reported.
“When the Australian Prudential Regulation Authority (APRA) raised questions about one of the contracts Kingston had awarded, he was allegedly evasive and doctored the contract before sending it to the regulator,” ABC News said. “Kingston was previously employed by the financial services watchdog, where he was a senior manager responsible for supervising credit unions – including BCU.”
‘Sham Redundancy’
The BCU court documents also allege that Kingston gave his wife a “sham redundancy” of $345,000 and then paid a further $341,000 across a year and a half to do essentially the same amount of work, ABC reported.
Kingston and his wife also allegedly claimed nearly $100,000 in false “living away from home” expenses, the suit alleges.
According to ABC, the credit union eventually fired Kingston in September 2017, to which Kingston filed a lawsuit, alleging that BCU broke his contract and still owed him bonuses.
In his statement of claim, ABC quoted Kingston as saying his dismissal was devised by BCU and its former chairman and co-defendant, Grant Wallace, over a disagreement on whether or not to extend Wallace’s tenure as chairman.
According to the ABC report, BCU’s lawsuit is a counterclaim to Kingston’s lawsuit.
‘Improper Proposal’
After Kingston lost his job, he attempted to present an “improper” proposal to BCU’s chairman, offering a consultancy that turned over $250,000 a year for his job back, the BCU court documents allege, according to ABC.
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