FEDERAL Member Mike Kelly is alleging more than $1million of government funds may have been misappropriated by the former chief executive officer of Katungul Aboriginal Corporation Community and Medical Services.
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The allegations come on the back of news the Federal Court in Sydney last week made interim orders to secure the assets of former Katungul CEO Damien Matcham.
Mr Kelly said the financial audit of the service has revealed that $667,000 was paid in bonuses to the chief executive officer, while another $100,000 was paid to the financial officer, with the transactions not approved by the board.
He also alleged that the service paid $225,000 in legal and administration fees in legal action and filing Freedom of Information requests against the Southern General Practice Network and himself.
“That’s just the start of it and with a $200,000 black hole in their budget right now it looks likes insolvency,” Mr Kelly said.
Mr Matcham could not be reached for comment.
Despite the alleged financial discrepancies, the Federal Government remained committed to the service allocating $1.8million in the 2011-12 time period, which was matched by the State Government with $500,000.
Mr Kelly said this was the most money to be allocated to a health service in the area, other than the GP super clinics.
The Katungul offices and health services in Narooma, Moruya and Bega would remain open and were being funded on a month-by-month basis during the administration period.
Mr Kelly said he, together with Indigenous Health Minister Warren Snowdon and other federal and state agencies, instigated the audit in September last year after receiving complaints from employees, elders and board members, and he himself had the opinion that “something was not right”.
In the past, Mr Matcham expressed frustration that funds for Aboriginal health care were being diverted to agencies such as the Southern General Practice Network.
He also took issue with the Eurobodalla Shire Council’s provision of community service, and at one point organised a caravan to be towed to the Wallaga Lake Koori village to provide Katungul services.
Katungul operates medical centres in Narooma and Bega for Aboriginal and Torres Strait Islander people living on the Far South Coast.
The Registrar of Indigenous Corporations, Anthony Beven, placed the medical service under special administration in December after concerns about poor corporate governance and weak financial management.
“I have commenced an investigation into a range of payments made to Mr Matcham totalling more than $500,000,” Mr Beven said.
“How a mortgage over Katungul’s Bega clinic was entered into in November 2009 to secure an overdraft facility is also under investigation.”
The registrar sought the freezing orders last week to protect assets for the purposes of a potential claim that may be made by the registrar against Mr Matcham.
A further hearing will take place before the Federal Court early this month to decide whether the interim order should be continued or varied.
