Shark patrol charity Australian Aerial Patrol under investigation over alleged fraud
Posted 16 minutes ago
The future of an Australian shark patrol charity looks in doubt amid a series of investigations into fraud and misappropriation of funds.
The ABC also understands that Harry Mitchell, the general manager of Australian Aerial Patrol (AAP), has been questioned by police over an attempt by an international drug syndicate to use the charity to launder the proceeds of crime.
The AAP — a shark spotting and emergency service which has operated on the New South Wales south coast for more than 50 years — is being investigated by police and government authorities for hundreds of thousands of dollars which allegedly cannot be accounted for.
Just two weeks ago the Aerial Patrol’s main sponsor, Bendigo Bank, withdrew funding after the resignation of the chief pilot and engineer.
Both claim they have not been paid. The Civil Aviation Safety Authority then grounded the entire fleet.
Mr Mitchell said he had a new chief pilot and was back in operation.
The charity has been facing financial difficulties for sometime.
But in early 2014 Mr Mitchell and the AAP board thought their financial woes were over when a consortium of businessmen, including pilot Bernhard Stevermuer, offered $1.5 million for the aircraft training and engineering side of the business.
A deposit of $750,000 was made.
Before the remaining money could be paid, the Middle Eastern Organised Crime (MEOC) squad arrested Stevermuer, who was charged and found guilty for his part in an international drug syndicate accused of flying drugs into Australia.
There is no suggestion that Mr Mitchell is part of the consortium or knew anything about the drug syndicate.
But police allege the $750,000 deposit was laundered through AAP and is money from the proceeds of crime.
The NSW Crime Commission has issued Mr Mitchell with a court order restraining the $750,000.
“The money has all been used. It’s all gone.” Mr Mitchell told the ABC.
Some AAP board members recently hired a forensic accountant to find out where the money went and why the organisation was in such financial trouble.
According to the report, Mr Mitchell paid for repairs and maintenance on his personal properties with charity funds.
He allegedly abused his fuel card and allegedly made suspect superannuation payments onto his American Express card.
General manager paid for work ‘he didn’t do’
As part of Mr Mitchell’s job to promote the shark patrol, he was paid by the charity to do traffic reports on local radio. He stopped doing the traffic reports in 2008 but he did not stop charging the charity.
“For about eight years he hasn’t been providing those traffic reports, but he has been paid a total amount of $127,000 for work he didn’t do,” Graham Pike, a former advisor to the board, said.
Now the Australian Taxation Office is allegedly chasing Mr Mitchell for hundreds of thousands of dollars.
“We are dealing with that at the moment,” Mr Mitchell responded.
He also denied wrongdoing concerning the charity’s finances.
“I am not the treasurer. I didn’t have access to funds. I wasn’t the signatory. I didn’t have access to any of that,” Mr Mitchell explained.
But treasurer John Weston disputed that.
“That is far from the truth. He has obviously had his other people like his bookkeeper and other signatories on the accounts to do his work,” he said.
The two signatories on the accounts were contacted by the ABC but did not want to respond.
Councils had ‘no idea’ how many patrols were done
The number of shark patrols — which is what the AAP gets its donation for — has also apparently dropped off.
In the financial year of 2013, the shark patrol received $545,000 dollars in donations and income, but flight logs show just $15,000 was spent on aerial shark spotting.
A former staff member contacted the sponsors — who are mainly made of local councils including Wollongong, Shoalhaven and Kiama councils — to let them know that the patrols were being done ad hoc but received no response.
“Councils were giving money with absolutely no idea of how many patrols were being done. They had no Service Level Agreements in place and didn’t seem to care too much,” the source told the ABC.
Wollongong City Council told the ABC it was reviewing its funding and the principal sponsor, Bendigo Bank, has walked from its relationship with Australian Aerial Patrol.
The Middle Eastern Organised Crime Squad, the local Illawarra police and the NSW Crime Commission are continuing their investigations.
The ABC also understands the Australian Charities and Not-for-profits Commission (ACNC) were informed that Australia’s most famous shark patrol charity was in a parlous state and needed to be investigated.
The ACNC declined to comment.
Cancer-suffering pilot sentenced to jail over drug importation flight into Wollongong
Updated 22 May 2015, 5:36pm
A pilot has been sentenced to nine months in jail for taking part in an international drug ring by flying a small plane thought to have been carrying drugs into Australia.
Wollongong father Bernhard Stevermuer, 43, pleaded guilty in February after a plane was raided by police at Illawarra Regional Airport last July, following a Middle Eastern Organised Crime Squad investigation into drug supply in the Sydney metropolitan area.
Police said Stevermuer had $70,000 in cash, his payment for flying the plane from the United States across the Pacific.
Stevermuer’s lawyer Mark Savicunsuccessfully argued that his cancer-suffering client took part in the deal because of his love of flying and wanting to secure his family’s finances.
Mr Savic said Stevermuer’s prognosis was that he had a 10 per cent survival rate over the next five years, but he was in remission.
He said “the excitement of flying a light aircraft all the way from the US back to Australia was a huge inducement in itself”.
“His love of flying caused him to be blind,” Mr Savic said.
Mr Savic described his client as a trustworthy, generous man who had contributed significantly to the aviation community.
Stevermuer admitted to the judge in a letter that he “thought it was too good to be true”, while another document tendered quoted his wife as saying he had an “ostrich-like stance”.
Sentencing magistrate in Port Kembla Local Court, Michael Stoddard, said Stevemuer may have been naive initially but said he “continued on dealing with these people and these serious offences that occurred”.
“One would wonder why he would put himself, particularly given the submissions made in relation to his family, why he would put these people in the position that he has,” hesaid.
Stevemuer’s lawyer argued he should receive a community service order or non-custodial sentence.
But the magistrate said that would be totally inappropriate and jailed Stevemuer until at least February 2016.
Stevermuer launched an immediate appeal against the sentence and has been granted bail ahead of a hearing.