Queensland’s corruption watchdog is under investigation to determine if it misused its powers to get rid of a council as a “gift” to the former CEO.

Action by the Crime and Corruption Commission resulted in a council in Australia’s eighth largest local government area being dissolved, striking out the democratic choice of the people of Logan City, chair of the Parliamentary Crime and Corruption Committee Jon Krause said.

“Underlying all this is the complaint that the CCC failed to act independently, impartially and with fairness,” Mr Krause said.

The investigation comes in response to a complaint against the CCC by the state’s peak local government body, LGAQ.

In his opening statement on Tuesday Counsel Assisting, Jonathan Horton QC, said the inquiry would focus on the CCC’s involvement in civil action by the then CEO, Sharon Kelsey, against the mayor and seven former councillors and Logan City Council, and processes that led to the councillors being charged with fraud in April 2019.

There is an available perception the CCC may have taken sides … in favour of Ms Kelsey and against the elected mayor and seven councillors and to have used public power in a way that at the very least pushed the legal boundaries.

Jonathan Horton QC

“There is an available perception the CCC may have taken sides … in favour of Ms Kelsey and against the elected mayor and seven councillors and to have used public power in a way that at the very least pushed the legal boundaries ,” Mr Horton told the committee.

Mr Horton said the CCC had intervened and advocated for Ms Kelsey in this action, meeting with her laywers and making “repeated expression of sympathy and partisanship” for her.

Dissolution of Council ‘a gift’ to CEO

The committee heard shortly after being appointed in 2017 Ms Kelsey blew the whistle on alleged wrongdoing at Council. She later claimed she was removed from her position in 2018 as payback, prompting her to take the case to the Queensland Industrial Relations Court.

 CCC Chair Alan MacSporran also asked the government for public money to fund Ms Kelsey’s $2.5 million legal action and assisted the QIRC with regards to the production of documents.

The mayor and former councillors were arrested and charged on April 26 2019 and the subsequent dissolution of Council was a “potential gift” to Ms Kelsey in her quest for reinstatement, Mr Horton said.

He said the CCR’s main memorandum underpinning the decision to lay charges praised Ms Kelsey and “demonised” the councillors, describing the mayor as living a “Jekyll and Hyde” existence.

“Was the material skewed?” asked.

The DDP dropped its action against the councillors in April 2021 because of lack of evidence.

Need to protect whistleblowers

In his evidence to the committee on Tuesday Mr MacSporran admitted he had sympathy for Ms Kelsey, who had raised a public interest disclosure (PID).

He said whistleblowers had to be taken seriously so corruption could continue to be reported to bodies like the CCC.

“She is a PID and we have a statutory responsibility to provide assistance to a PID,” he said.

If a person comes to you and says ‘I’m concerned about corrupt conduct of a mayor, he appears to be taking action against me because I’ve met privately with you’, that’s a matter you have to take seriously

Asked whether he approached her claims with “healthy skepicsm”, Mr MacSporran replied:  “you need to be objective … if a person comes to you and says ‘I’m concerned about corrupt conduct of a mayor, he appears to be taking action against me because I’ve met privately with you’, that’s a matter you have to take seriously.”

Mr MacSporran also told the inquiry he had been the victim of abuse and bullying by LGAQ CEO Greg Hallam.

Mr Horton said the CCC had extraordinary powers possessed by no other arm of parliament, and the proper and accountable use of those powers is of great importance to everyone in the state.

Mr Krause said the CCC’s powers were “far reaching  and often very invasive”.

“As has been recognised for centuries there is a need even for the watchdogs to be held accountable,” he said.

The hearing is expected to continue for two weeks.