3 months ago
6
In a statement on Wednesday, MA Services said it had considered but not proceeded with the opportunity to provide security on Nauru. It insisted it was not aware of Jones’ longstanding deep links to bikie gangs and that he had ceased employment with the company in June.
The investigations into worker exploitation and tax fraud facing MA involve its provision of thousands of guards across Australia, including at Coles stores, Kmart, major sporting events such as the spring carnival, ports and local, state and federal agencies and construction projects.
It is not only MA – which has hired two PR companies in as many weeks and called in a top legal firm to fend off allegations of wrongdoing – that is facing serious questions, but its blue-chip corporate and government clients, who appear to have overlooked red flags in the company’s operation.
In one example of failed due diligence, the Victorian government has listed MA Services as an approved and recommended security guard supplier at the same time the state’s labour-hire regulator has placed highly onerous conditions on the company’s licence due to its concerns.
In another example that raises serious questions for the federal government, MA Services has won contracts worth millions of dollars to provide guards to federal law enforcement agencies and departments as the ATO probes its suspected involvement in a years-long tax evasion scheme.
Loading
The alleged scheme is being probed by the Tax Office as part of a secret operation.
The scheme is also subject to investigations by insolvency practitioners, most recently led by veteran liquidators Richard Rohrt and Karen Kelson.
It involves allegations that MA is operating a shadow security guard workforce of several thousand migrant employees across Australia who, while wearing MA uniforms, are employed by front companies that in turn utilise corrupt payroll firms to underpay workers, denying them superannuation or other entitlements, while avoiding tax obligations.
When the Tax Office seeks to recover what it is owed, these subcontractors and payroll firms collapse and their directors disappear overseas or refuse to assist investigators, according to liquidators’ reports and company sources.
One of many MA-linked subcontractors being probed by Rohrt and Kelson, the ATO or other insolvency investigators is Auswide Management Solutions, which collapsed owing $21 million in taxes to the federal and state governments.
In their report filed with the corporate regulator in October 2024, Rohrt and Kelson reveal that the ATO has disclosed that “a significant number” of security guards ostensibly employed by Auswide were rotated “through numerous liquidated labour hire companies in succession” in a scheme that exhibits “tax evasive behaviours”.
“The ATO indicates [Auswide] … deliberately set up their business structure to avoid reporting and paying their tax and super liabilities,” Rohrt’s report states.
It also reveals that the Tax Office is probing the firm’s role as one of several “interlinked” front companies “operating in the shadow economy”, with more than 3000 mostly migrant security guards contacted by Rohrt and Kelson as they sought to understand who they really worked for.
According to Rohrt, two employees revealed to him they had received payslips indicating their actual employer was “MA Services Group Pty Ltd”. Rohrt has subsequently begun investigations into six companies suspected to be involved in the scam involving “a larger labour hire structure and a broader group investigation”.
Another subcontractor involved in the Tax Office investigation is collapsed business Arma Security Services, which Rohrt said in a liquidator’s report in 2020 had made “a significant number of transactions where funds were withdrawn from ATMs” in a suspect fashion.
“Some of the transactions identified were withdrawals from the Crown Casino, which would suggest that funds were being misused,” said Rohrt, who identified millions of dollars in suspect transactions, including “transfers and cash withdrawals totalling $3,322,461”.
The latest company linked to the scandal to collapse is LSS, which entered liquidation a fortnight ago and – according to MA Services records leaked to this masthead – has been used by MA to employ hundreds of guards across Australia, including at Coles shopping centres.
Evidence suggests that LSS is a front company run by one of a number of suspected dummy directors. When this masthead called the director’s employer, a suburban accounting firm, it said he had left the firm under a cloud and was now an Uber driver. Despite leaked employee records revealing that LSS is used by MA to supply guards to Coles, the director said he did not work with MA Services.
“I don’t know them,” he said when pressed by this masthead on his relationship with MA Services.
In contrast, MA Services said in its statement that it had a contractual relationship with LSS.
Five statutory reports prepared by liquidators for collapsed companies linked to MA Services reveal non-compliant bookkeeping, non-commercial transactions and a reluctance by directors to co-operate.
Records leaked from MA Services also reveal that some of its security guards are breaching the conditions of their student visas, which permit them to work only 48 hours a fortnight. Leaked visa records with internal MA Services rosters for guards stationed at Coles, Amazon and Geelong Grammar reveal the firm’s guards working up to seven days a week, in breach of their visa requirements.
A 2023 report by liquidator Craig Crosbie into another firm implicated in the scandal, RMK Management Services, tracked suspect “payments made for motor vehicles and IT equipment supplied to two businesses in Pakistan”.
“Whilst further information is required, it is likely that the payments may constitute uncommercial transactions and/or fraudulent dispositions,” Crosbie noted.
In addition to the ATO, this masthead has also confirmed that Victoria’s Labour Hire Authority has probed MA Services, and its latest annual report reveals how the company was subject to a “lengthy investigation” that led to stringent conditions on MA’s licence.
Kardinia Park in Geelong.Credit: Eddie Jim
The authority’s investigation found a number of MA Services’ “contracts with sub-contractors contained low contract prices which would not allow the sub-contractors to comply with minimum legal obligations to workers”.
Security industry sources claim MA’s undercutting allowed it to win a huge number of contracts across the country, but also sparked concern inside the integrity departments of its corporate and sporting clients who feared the company may be ripping off its foreign workers.
The Kardinia Park Stadium Trust, which runs the home ground of the Geelong Cats AFL team, is one company that stopped using MA after an internal investigation found evidence of employee exploitation and ghosting (which involves charging a client for nonexistent security guards).
Coles, which employs hundreds of MA Services’ guards across its stores, said in a statement it was aware of the allegations and had “commenced an internal investigation”.
“Our ethical sourcing standards set out clear requirements for all suppliers on business integrity, labour and human rights, and health and safety,” it said. “We take these requirements seriously.”
Spectators watch the Australian Formula One Grand Prix.Credit: AP
A spokesperson for the Australian Grand Prix Corporation said it was “making preliminary inquiries in light of recent media coverage” about MA Services, with the firm contracted to provide hundreds of guards to the Formula 1 race in early March.
MA’s other clients include Kmart, the Australian Criminal Intelligence Commission and the federal Department of Parliamentary Services.
Amazon and Wesfarmers (which owns Kmart) were approached for comment.
A Bunnings spokesperson said the company took the allegations very seriously. “We are actively seeking more information and clarity from the provider, while monitoring the situation,” the spokesperson said.
In a statement, MA Services denied connection to any company involved in wrongdoing, insisting the subcontractors it uses are all carefully vetted and act lawfully and ethically.
The Melbourne Demons AFL club has the MA Services logo printed on its 2026 game day guernsey, but sources said it was one of several league clubs rethinking its relationship with the firm. Last week, this masthead revealed how MA was offering controversial sponsorship-for-contracts deals with AFL clubs.
MA Services is also facing scrutiny for claiming in tender documents that a veteran senior sergeant “sits on our [MA Services] training committee and will also deliver training based on real life situations and case studies”.
Police are prohibited from working in the private security industry. In a statement, a Victoria Police spokesperson confirmed “the member does not have approved secondary employment with this organisation” and the force “take these allegations seriously and are making relevant inquiries”.
Last week, this masthead revealed how MA had faced years of persistent allegations from company insiders of serious wrongdoing involving systemic mistreatment and exploitation of staff, including women.
Those claims have been further supported by freshly leaked internal documents that corroborate allegations raised by a dozen MA insiders about rampant fraud and worker exploitation involving the firm.
One MA insider told this masthead how the firm’s guards were working on major Victorian government transport projects “without valid work rights, railway cards or white cards” and were receiving “payments made in cash or flat rates into guards’ bank or their friends’ bank”.
“Student visa holders with restricted work rights are deployed across multiple sites, exceeding their legal 24-hour weekly limit. Subcontractors are used to funnel cash payments to guards, often rotating payroll companies annually to avoid detection.
“These payroll companies are deliberately liquidated every year and replaced with new entities to hide GST and tax fraud ... evidence demonstrates a deliberate system designed to exploit vulnerable workers, breach visa conditions and defraud both clients and regulators.”
Start the day with a summary of the day’s most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.
