A project manager in the WA state government took a 10 per cent cut of every contract awarded to a mate, a corruption investigation has found.

The investigation uncovered what the state’s corruption watchdog describes as a ‘web of corruption, manipulation and deceit’ in WA’s former housing department.

The Corruption and Crime Commission report, Misconduct in the Department of Communities relating to country building projects , details how a senior project manager with the then housing department accepted kickbacks from two men who, with his help, won lucrative contracts.

It was, the CCC found, “another example of corruption made possible by flawed systems and poor oversight with powerful lessons for all public sector agencies”.

A helping hand

The investigation found the project manager, Mark Ainslie, had the authority to award contracts of up to $50,000 for the construction, renovation and repair of social housing in regional and Aboriginal communities without competitive quotes.

It found Peter Haxby of HRD Construction Management and Nicholas Rumenos of Griffin Civil, both of whom were acquaintances of Mr Ainslie, were able to exploit this to their advantage.

Is every Director General or CEO confident that the events outlined in this report could not happen in their own department?

WA Corruption and Crime Commission

Both men were awarded lucrative contracts by Mr Ainslie, and Mr Ainslie pocketed payments in return.

In 2014 Mr Haxby became an approved Housing vendor, with Mr Ainslie getting 10 per cent of the value of every contract awarded and Mr Haxby getting a ‘helping hand’ to win contracts, the CCC found.

Meanwhile, Mr Rumenos was awarded more than $4 million worth of contracts between 2016 and 2019 with the help of Mr Ainslie.

Nearly $200,000 was transferred to bank accounts controlled by Mr Ainslie, the report found.

Over to the police

Mr Ainslie resigned from the Department of Communities in March 2020 and is now employed by Griffin Civil.  Mr Haxby has agreed to repay $10,500.

The CCC has referred Mr Ainslie, Mr Haxby and Mr Rumenos to the police.

The corruption first came to light when the now Department of Communities undertook a a review following the 2019 arrest of the former Assistant Director General on corruption charges.

The CCC says the report should serve as a lesson to all state government departments about the importance of having strong corruption prevention controls.

“Having procedures is not enough,” it says. “They must be followed and enforced. Is every Director General or CEO confident that the events outlined in this report could not happen in their own department?”