FORMER chief executive officer of the Katungul Aboriginal Health Service, Damien Matcham, has admitted misappropriating more than $700,000 from the service between June 2007 and February 2012.
On Wednesday, September 11 at the Sydney Federal Court Justice Jacobson made 25 declarations of contraventions against Mr Matcham, which included unauthorised payments for bonuses, time in lieu, superannuation, recreation leave and life insurance, in excess of $700,000.
Justice Jacobson declared that Mr Matcham had not acted in good faith and in the best interests of the corporation and had improperly used his position as CEO to gain a personal advantage and cause detriment to Katungul.
Mr Matcham admitted his guilt last week after initially defending his position.
The penalties for Mr Matcham’s actions will be considered during court proceedings in November.
The Registrar of Indigenous Corporations, Mr Anthony Beven, is seeking orders to see Mr Matcham fined and forced to pay compensation to Katungul, as well as being banned from managing companies and Aboriginal or Torres Strait Islander corporations.
“He agreed to a statement of facts in which he admitted that his conduct breached the CATSI Act,” Mr Beven said.
“He should repay all of the money back to Katungul with interest. Even if he repays one dollar, that’s one dollar that will go back to those who need it for medical treatment,” Mr Beven said.
Maximum fines for each contravention are $200,000, with 25 declarations made Mr Matcham stands to face a considerable fine.
Whether the funds will be recouped is yet to be seen.
“He’s defended the proceedings all the way up until last week, so it has been a very expensive process for him and for us,” Mr Beven said.
Mr Matcham did not respond to requests for comment from the Narooma News.
Mr Beven said the court action sent a clear message. “There are serious consequences if CEOs misuse their position,” he said.
Staff that discovered the financial losses, including former and current directors of Katungul, were praised and thanked for their work in restoring Katungul’s integrity.
“When they became aware that money that was to be used to improve the health of their community was being diverted to one person they notified my office. They also provided invaluable support during the Federal Court proceedings,” Mr Beven said.
“This is a good outcome and it is pleasing to see that truth and justice have prevailed for Katungul and its members and clients,” he said.
Katungul is a multimillion dollar not-for-profit corporation that provides essential primary and secondary health services to Aboriginal and Torres Strait Islander people living on the far south coast of NSW from Batemans Bay to the Victorian border.
Since the losses were exposed Katungul has restored its services and is now in a strong financial position. It has expanded its range and types of health services.
Now operating with new CEO Jon Rogers, who was appointed in August 2012, Katungul is restoring trust and rebuilding itself as a holistic service providing numerous support services.
“It’s about trust and the real story here is about the healing that’s happening,” Mr Rogers said.
Among some of the changes is a significant increase in services.
“We have doubled the number of GP clinics,” Mr Rogers said.
Time line of events
September 2011 – Katungul CEO Damien Matcham takes leave.
September 2011 – Government agencies instigate audit after receiving complaints from employees, elders and board members.
October 2011 – The Registrar of Indigenous Corporations, Mr Anthony Beven starts examination of the corporation.
December 2011 - Katungul placed under special administration following discovery of misappropriation of funds.
January 2012 – Mr Beven starts Federal Court proceedings against Mr Matcham obtaining orders freezing bank accounts and property.
February 2012 – Mr Matcham’s contract as CEO of Katungul is terminated.
August 2012 - New CEO Jon Rogers appointed
October 2012 – Community control is returned to Katungul.
September 2013 – Mr Matcham faces Sydney Federal Court and admits misappropriation of funds totalling $700,000.