Underworld links to offshore detention providers

Home Affairs awarded billions of dollars in contracts to companies with links to drug trafficking, illegal arms trades and other offences to run Australia’s offshore detention regime, according to an investigation by former ASIO boss Dennis Richardson.

What we know:

  • Richardson found systemic failures within Home Affairs to conduct due diligence on companies before handing them major contracts to run asylum seeker offshore processing, with time pressures leading to “short cuts” being taken (The Age);
  • The investigation was flagged by the government last year after reports that millions of dollars in Commonwealth payments were going to allegedly corrupt firms and foreign officials (AFR);
  • The report found that companies “under investigation by the AFP”, whose owners were suspected of “seeking to circumvent US sanctions against Iran” and that had “extensive suspicious money movements suggesting money laundering” had landed Home Affairs contracts;
  • Richardson blamed senior public servants for failing to properly use intelligence to conduct due diligence, saying that it was a matter of the “left arm not knowing what the right arm’s doing”;
  • For the report, he looked at information on the companies held by the national intelligence community, along with cabinet submissions and minutes;
  • The report found that Canstruct was awarded a $1.8bn to run offshore processing on Nauru from 2017 to late 2022 while facing an AFP financial crime and bribery probe;
  • In this time, Canstruct made about $100m in annual profits from the offshore processing contract;
  • According to the report, Paladin Group was awarded contracts worth $500m over four years to run offshore processing on Manus Island while facing an AFP investigation into allegations bribes were paid to PNG officials;
  • Canstruct has since been replaced by US private prison operator Management and Training Corporation (The Saturday Paper).