Chapter One - Prior to Arbitration
Tampering with technical evidence, falsifying two similar technical reports, and criminal conspiracies to hide the true extent of Telstra's poor telecommunications network from the citizens of Australia.
Corruption is contagious and does not respect sectoral boundaries.
TIO Evidence File No 3-A is an internal Telstra email (FOI folio A05993) dated 10 November 1993 from Chris Vonwiller to Telstra’s corporate secretary Jim Holmes, CEO Frank Blount, group general manager of commercial Ian Campbell and other important members of the then-government owned corporation. The subject is Warwick Smith – COT cases, and it is marked as CONFIDENTIAL:
“Warwick Smith contacted me in confidence to brief me on discussions he has had in the last two days with a senior member of the parliamentary National Party in relation to Senator Boswell’s call for a Senate Inquiry into COT Cases.
“Advice from Warwick is:
Boswell has not yet taken the trouble to raise the COT Cases issue in the Party Room.
Any proposal to call for a Senate inquiry would require, firstly, endorsement in the Party Room and, secondly, approval by the Shadow Cabinet. …
The intermediary will raise the matter with Boswell, and suggest that Boswell discuss the issue with Warwick. The TIO sees no merit in a Senate Inquiry.“He has undertaken to keep me informed, and confirmed his view that Senator Alston will not be pressing a Senate Inquiry, at least until after the AUSTEL report is tabled.
“Could you please protect this information as confidential.”
Exhibit TIO Evidence File No 3-A confirms that two weeks before the TIO was officially appointed as the administrator of the Fast Track Settlement Proposal (FTSP), which became the Fast-Track Arbitration Procedure (FTAP), he provided the soon-to-be defendants (Telstra) with privileged, government party room information about the COT cases. Thus, the TIO breached his duty of care to the COT claimants and compromised his future position as the official independent administrator of the process.
It is highly likely the advice the TIO gave to Telstra’s senior executive, in confidence (that Senator Ron Boswell’s National Party Room was not keen on holding a Senate enquiry), later prompted Telstra to have the FTSP non-legalistic commercial assessment process turned into Telstra’s preferred legalistic arbitration procedure, because they now had inside government privileged information: there was no longer a significant threat of a Senate enquiry.
The Establishment
The Australian Establishment perceived him as a crucial figure in the telecommunications landscape, primarily because he was tasked with safeguarding the assets of Telstra, which was then a government-owned telecommunications carrier. His actions were viewed as a means of protecting public funds, ultimately benefiting all Australians. However, a significant oversight lies in the acknowledgement from the arbitrator and the government. When Dr Hughes manipulated legal interpretations to shield Telstra and its shareholders, this clearly constituted a breach of the rule of law.
Both Telstra and the Telecommunications Industry Ombudsman (TIO), which played a vital role in overseeing the arbitration process, exploited their positions to mislead various stakeholders. They presented a façade to government ministers, the media, and the public, convincing them that services which had been scrutinised during the arbitration were operating efficiently and effectively following the arbitrator's award. When claimants contested these assertions, Telstra, the TIO, and the arbitrator adopted a strategy of prolonged resistance, hoping to wear down the claimants' resolve.
In my own experience, as I elaborate in Bad Bureaucrats, I found that despite the passage of six years following my arbitration, no action was taken to investigate my ongoing complaints regarding unresolved arbitration faults. My business, which I reluctantly sold to the Lewis family in December 2001, became entangled in a web of administrative neglect. Their own seven-year endeavour to rectify these persistent issues is chronicled throughout our narrative, underscoring the extent of the challenges we faced.
To provide clarity in this statutory declaration, we must first examine the events that occurred prior to April 1994. At that time, the appointed commercial assessor, along with the first TIO and the defendants, who Telstra represented, made a controversial decision to transform the initial commercial assessment procedure, known as FTSP, into a complex and highly legalistic arbitration process. Telstra's legal team wielded considerable influence, controlling a network of at least 33 of Australia's most prestigious law firms, as well as virtually all of the nation's technical resource units, as documented in Senate Hansard on June 24 and September 26, 1997.
With an arbitration agreement that they had crafted and later faxed to the TIO on 10 January 1994, Telstra effectively gained the upper hand in the entire arbitration process. Subsequently, Dr Hughes raised concerns in his letter dated 12 May 1995 (see Open Letter File No/56-A), informing the TIO that Telstra had misled them into utilising an agreement that failed to provide adequate time for the
“inevitable delays associated with the production of documents, obtaining further particulars, and the preparation of technical reports.”
The ethical path available to these two lawyers should have been to admit their role in misleading the four COT cases, their lawyers, and numerous government ministers, including the press gallery at Parliament House in Canberra, into believing that the arbitration agreement had been prepared independently of Telstra. This assertion was a blatant falsehood to which both of them were privy. Instead of coming forward with the truth, they opted for concealment, resulting in the systematic erosion of three decades of our lives and livelihoods.
“(3) Telecom does not accept the COT Cases’ grounds for reviewing the earlier settlements. However, on the basis of a denial of liability and without any legal obligation to do so and purely as a matter of good faith and business expediency, Telecom is prepared to agree to the above mentioned review.
(4) This proposal constitutes and offer open to all or any of the COT Cases referred to in Clause (1) (a), which will lapse at 5 pm Tuesday 23 November 1993. This offer may be accepted by signature below and sending advice of such signature to AUSTEL or the Telstra Corporate Secretary before that time.”
On 23 November, Graham Schorer, Ann Garms, Maureen Gillan, and I signed the FTSP, trusting the Regulator’s verbal assurances that consequential losses would be included. These signed FTSP agreements were forwarded to Telstra’s corporate secretary. Alan included a letter with his agreement, clearly putting his expectations of the process:
“In signing and returning this proposal to you, I am relying on the assurances of Mr Robin Davey, Chairman of Austel, and Mr John MacMahon, General Manager, Consumer Affairs, Austel, that this is a fair document. I was disappointed that Mr Davey was unwilling to put his assurances in writing, but I am nevertheless prepared to accept what he said.
It goes on to say:
I would not sign this agreement if I thought it prevented me from continuing my efforts to have a satisfactory service for my business. It is a clear understanding that nothing in this agreement prevents me from continuing to seek a satisfactory telephone service.”
A more precise chronology of events surrounding the Fast Track Settlement Proposal v Fast Track Arbitration Procedure and who drafted the original FTAP can be obtained by clicking on Evidence - C A V Part 1, 2 and 3 - Chapter 3 - Fast Track Settlement Proposal.
Part Two
Who Paid Grant Campbell?
This TIO document (File 56-B - Open Letter File No/56-A to 56-D) dated 10 January 1994 confirms that one of Telstra's executives, Grant Campbell, was handling my FTSP process, mentioning (Ferrier Hodgson Corporate Advisory) the TIO-appointed Resource Unit to the FTSP.
I was never informed during the FTSP or later through the Fast Track Arbitration Procedure that Grant Campbell had been seconded from Telstra or that he had defected back to Telstra during my FTSP or the FTAP. The following exhibits confirm that an unhealthy relationship existed between the TIO office and Telstra during my FTSP period.
Interestingly, the 1993/94 TIO Annual Report does not list Mr Campbell as having worked for the TIO office, even though Mr Campbell held a senior managerial position with the TIO office. Please consider the following points:
- TIO documents dated 9 February 1994 (File 55-B ) confirm that Grant Campbell was signing letters on behalf of Warwick Smith, particularly regarding the fax billing and lock-up complaints included in my FTSP claims.
- Telstra FOI documents H00027, H36279, and H36280 (File 56 GOpen Letter File No/56-A to 56-D) confirm that, in January and February 1995, Grant Campbell and Ted Benjamin were addressing the same types of 008/1800 billing issues on behalf of Telstra’s Customer Response Unit. This is the same Unit that Ted Benjamin headed when he wrote to Dr Hughes on 16th December 1994 to confirm that Telstra had advised AUSTEL, in writing, that they would address my 008/1800 billing issues as part of their defence of his claim, as per the arbitration agreement. I have always been concerned about Grant Campbell’s handling of my 008/1800 arbitration materials that went through the TIO’s office in 1994.
During the early stages of the FTSP, the COT claimants were told that Pia Di Mattina had been seconded from Minter Ellison (TIO Lawyer) by the TIO to assist him in the COT Arbitration Process. Miss Di Mattina’s name, understandably, does not appear in the TIO 1993/94 employee list that is included in the 1993/94 Annual Report (the report can be supplied on request), although all the other TIO employees are listed there, it is also interesting to note that Grant Campbell’s name is not included on the employee list either, even though he dealt with a number of the billing issues during Alan Smith’s arbitration, as well as accepting part of Alan Smith’s original FTSP claim lodged with the TIO office on 27th January 1994.
This Telstra internal email FOI folio 000973 (AS 542-E) notes:
"The ex-employee’s name is Grant Campbell. Grant then worked as the Deputy Telecommunications Industry Ombudsman and then on a senior management review team".
On 9 February 1994, Mr Campbell wrote to Telstra’s Fiona Hills, under the heading Loss of Fax Capacity, noting:
"I spoke with Alan Smith on the 9 instant following our discussion on the 8 instant. He has agreed that this is a new matter and may indicate some ongoing problems, but it is not a matter that relates directly to the preparation of his material to be presented to the Assessor".
Mr Campbell’s statement to Fiona Hills that “He has agreed that this is a new matter” does not match the information in (AS 767-A, 768, 769, 770, 771, and AS 772-A) which confirms that local (Portland) Telstra technicians were aware of the significant problems associated with the faxing capacity issue, at least as far back as October 1993. Mr Campbell’s correspondence was, therefore, clearly misleading fellow Telstra employees and, possibly, Warwick Smith about the ongoing problems. This adds even further weight to my claims that there needs to be a transparent investigation into the TIO-administered COT arbitrations.
It is fantastic enough to find that Grant Campbell was seconded from the employment of the defendants during the COT arbitrations. Still, it is even more amazing to learn that, while he was wearing his TIO hat, he was also working on 1800 problem claims lodged by another COT claimant but, in this instance, he was wearing his Telstra hat! These two different ‘hats’ must lead directly to an understanding that no one may ever know how many claim documents the COT cases sent to the TIO’s office while Grant Campbell was wearing his TIO hat but being paid by Telstra.
We may never uncover how many arbitration procedural documents never made it to the viewing room that the TIO-appointed, secretly-absolved-from-risk, arbitration Resource Unit appeared to have access to.
We have raised the issue of this Grant Campbell fax capacity issue here because Dr Hughes’ technical Resource Unit never provided me with the results of their investigations into the lost faxes, even though it cost me well over to $300,000.00 to participate in the arbitration process; and even though clause 11 in the official Arbitration Agreement notes: '
The Arbitrator's reasons will be set out in full in writing and referred to in the Arbitrators award, the lost fax issues were not referred to: 'in full in writing' in the Arbitrators award.
Like Grant Campbell, Warwick Smith and his appointed Arbitration Technical Resource Unit they appear to have misunderstood the significance of the 008/1800 problem, because they failed to alert Dr Hughes that the 008/1800 service I used was actually routed through his main service line, 055 267 267, the line that one of the two faulty EXICOM phones was connected to – the phone that was prone to lock-up after each terminated call. In other words, when the Resource Unit advised John Pinnock (TIO) on 15 November 1995, and Dr Hughes on 2 August 1996 (AS 220), that Alan’s 008/1800 billing claims were not addressed, they were also admitting to not investigating or addressing my main service line 055 267 267.
Was there a more sinister motive behind the decision to ignore my billing claims, the same 008/1800 billing faults that Telstra’s Grant Campbell investigated while working with the TIO (on secondment from Telstra) and then worked on again later after he went back to Telstra to work alongside TIO Council Member Ted Benjamin?
Did Ted Benjamin's relationship with Telstra and the TIO Council have anything to do with his later relationship with Grant Campbell? There appears to be NO doubt that this particular issue – of Grant Campbell addressing 008/1800 problems on behalf of the TIO and then on behalf of Telstra, all during Alan’s arbitration – created a massive conflict of interest.
Could it be that, when I told Mr Campbell that he needed all the documents related to his earlier settlement, from before December 1992, so he could show how undemocratic this 1992 settlement process was, Mr Campbell then passed that information straight on to Telstra, thereby effectively alerting Telstra to which documents they could ‘lose’ because it was relevant to my case? It is also interesting to connect this issue to a letter written on 11 November 1994 to Telstra from the Commonwealth Ombudsman’s Office, asking why the earlier settlement material I requested under FOI had still not been supplied to him.
Part Three
Minimising Telstra’s liability
The document from March 1994 (AUSTEL’s Adverse Findings) reveals a troubling reality: government officials tasked with investigating my ongoing telephone issues found my claims against Telstra to be valid. This was not merely an oversight; it indicates a deliberate pattern of misconduct that played out between Points 2 and 212. It is chilling to consider that, had the arbitrator been furnished with this critical evidence, he would likely have awarded me far greater compensation for my substantial business losses. Instead, my claims were weakened because they lacked a proper log over the six-year period that AUSTEL deceptively used to formulate their findings, as outlined in AUSTEL’s Adverse Findings.
Compounding this treachery, government records (Absentjustice-Introduction File 495 to 551) show that AUSTEL's damaging findings were handed over to Telstra, the defendants, one month prior to the signing of the arbitration agreement. This calculated manoeuvre ensured that Telstra was armed with information that I, the innocent party, was wholly unaware of until November 23, 2007—a staggering twelve years after my arbitration concluded. This insidious manipulation left me unable to challenge the arbitrator's decision, as I was now trapped beyond the statute of limitations. Such glaring misconduct not only obstructed my quest for justice but also casts a shadow over the integrity of the entire arbitration process, suggesting a concerted effort to protect Telstra's interests at the expense of fairness and accountability. This scheme reeks of corruption and betrayal, leaving me to question the very foundations of a system that is meant to uphold justice.
Just imagine what the arbitrator might have awarded me had Telstra and AUSTEL not withheld this evidence from me?
Next Page ⟶Page 2 – "Mr Smith has had an ongoing complaint about the level of service for some time .....customer was originally connected to an old RAX exchange, which had limited junctions between Portland and Cape Bridgewater. Thus, congestion was a problem for all customers on the Cape Bridgewater exchange. The exchange was upgraded to an RCM parented back to the Portland AXE 104".
Page 10 – “Whilst Network Investigation and Support advised that all faults were rectified, the above faults and record of degraded service minutes indicate a significant network problem from August 1991 to March 1993.”
Point 23 – “It is difficult to discern exactly who had responsibility for Mr Smith’s problems at the time, and how information on his problems was disseminated within Telecom. Information imparted by the Portland officer on 10 February 1993 of suspected problems in the RCM “caused by a lightning strike to a bearer in late November” led to a specialist examination of the RCM in March 1993. Serious problems were identified by this examination.”
Adequacy of Response
Point 25 – "It should also be noted that during the period of time covered by this chronology of significance events it is clear
- Telecom had conducted extensive testing
- Cape Bridgewater Holiday Camp frequestly reported problems with the quality of telephone service
- both the camp and Telecom were receiving confirmation of reported from other network users
- major faults were identified more through persitense reporting of probles by customer than through testing of the network
- customers in the Cape Bridgewater area also complaining of similar problems
Point 26 – "The chronology of significant events demonstrates that Telecom conducted estensive testing and Telecom rectified faults without delay when faults were identified. It is clear, however, that
- Cape Bridgewater Holiday Camp was exposed to significant network problems over an extended period of time
- Telecom testing did not not detect all of the network problems affecting Mr Smith".
Telecom's Approach to Reaching a Settlement
Point 27 – "As is discussed under allegation in more detail throughout this document, Telecom's failure to adequately identify Mr Smith's network problems challenges the bases of Senior Telecom Management's approach to the resolution of Mr Smith's complaints and his claims for compensation etc, etc
Point 29 – "A fundamental issue underlying Telecom's settlement with Mr Smith was the question of whether Telecom had taken reasonable steps to comprehensively diagnose the standard of Mr Smith's telephone service. This is an important point as settlement took place on the bases that both parties agreed Mr Smith was receiving an acceptable standard of service at the time of settlement. Mr Smith maintains he was under considerable financial pressure to reach settlement, leading him to accept Telecom's assurances of his services at the time of settlement."
Point 32 – "Telecom's communications with Mr Smith in the months prior to settlement uniformaly argued that the Cape Bridgewater Holiday Camp was at an acceptable level and that Telecom was capable of rapidly rectifying faults as they occured."
Point 42 – “Some important questions are raised by the possible existence of a cable problem affecting the Cape Bridgewater Holiday Camp service. Foremost of these questions is why was the test call program conducted during July and August 1992 did not lead to the discovery of the cable problem. Another important question is exactly how the cable problem would have manifested in terms of service difficulties to the subscriber.”
Point 44 – “Given the range of faults being experienced by Mr Smith and other subscribers in Cape Bridgewater, it is clear that Telecom should have initiated more comprehensive action than the test call program. It appears that there was expensive reliance on the results of the test program and insufficient analysis of other data identifying problems. Again, this deficiency demonstrated Telecom’s lack of a comprehensive and co-ordinated approach to resolution of Mr Smith’s problems.”
Point 46 –“File evidence clearly indicates that Telecom at the time of settlement with Mr Smith had not taken appropriate action to identify possible problems with the RCM . It was not until a resurgence of complaints from Mr Smith in early 1993 that appropriate investigative action was undertaken on this potential cause In March 1993 a major fault was discovered in the digital remote customer multiplexer (RCM) providing telephone service to Cape Bridgewater holiday camp. This fault may have been existence for approximately 18 months. The Fault would have affected approximately one third of subscribers receiving a service of this RCM. Given the nature of Mr Smith’s business in comparison with the essentially domestic services surrounding subscribers, Mr Smith would have been more affected by this problem due to the greater volume of incoming traffic than his neighbours.”
Point 47 –“Telecom's ignorance of the existence of the RCM fault raises a number of questions in regard to Telecom's settlement with Smith. For example, on what bases was settlement made by Telecom if this fault was not known to them at this time? Did Telecom settle with Mr Smith on the bases that his complaints , of faults were justified without a full investigation of the validity of these complaints, or did Telecom settle on the basis of faults substantiated to the time of settlement? Wither criteria for settlement would have been inadequate, with the later critera disadvantaging Mr Smith, as knowledge of the existence of more faults on his service may have led to an increase in the amount offered for settlement of his claims".
Point 48 – “AUSTEL has been hampered in assessing Telecom’s dealings with Mr Smith by Telecom’s failure to provide files relating to Mr Smith’s complaints.”
Point 49 –: "As a result of Telecom's failure to provide file documentation relating to Mr Smith some of the following conclusions are consequently based on insufficient information. The information which is avaialble however, demonstates that on a number of issues Telecom failed to keep Mr Smith informed on matters fundamental to the assessment of his complaints".
Point 71 –: “AUSTEL has not been provided with the documents on which the conclusion in this briefing summary were reached, such as fault reports from other Cape Bridgewater subscribers over this period or the details of the final selector fault. It would have been expected that these documents would have been retained on file as background to the summary. It can only be assumed that they are contained within the documentation not provided to AUSTEL.”
Point 76 – “One disturbing matter in relation to Mr Smith’s complaints of NRR is that information on other people in the Cape Bridgewater area experiencing the problem has been misrepresented from local Telecom regional manager to more senior manager.”
Point 86 – “From examination of Telecom’s documention concerning RVA messages on the Cape Bridgewater Holiday Camp there are a wide range of possible causes of this message.”
Point 109 – The view of the local Telecom technicians in relation to the RVA problem is conveyed in a 2 July 1992 Minute from Customer Service Manager – Hamilton to Managers in the Network Operations and Vic/Tas Fault Bureau:
- “Our local technicians believe that Mr Smith is correct in raising complaints about incoming callers to his number receiving a Recorded Voice Announcement saying that the number is disconnecte. They believe that it is a problem that is occurring in increasing numbers as more and more customers are connected to AXE. (AXE – Portland telephone exchange)”
Point 115 –“Some problems with incorrectly coded data seem to have existed for a considerable period of time. In July 1993 Mr Smith reported a problem with payphones dropping out on answer to calls made utilising his 008 number. Telecom diagnosed the problem as being to “Due to incorrect data in AXE 1004, CC-1. Fault repaired by Ballarat OSC 8/7/93, The original deadline for the data to be changed was June 14th 1991. Mr Smith’s complaint led to the identification of a problem which had existed for two years.”
Point 130 – “On April 1993 Mr Smith wrote to AUSTEL and referred to the absent resolution of the Answer NO Voice problem on his service. Mr Smith maintained that it was only his constant complaints that had led Telecom to uncover this condition affecting his service, which he maintained he had been informed was caused by “increased customer traffic through the exchange.” On the evidence available to AUSTEL it appears that it was Mr Smith’s persistence which led to the uncovering and resolving of his problem – to the benefit of all subscribers in his area”.
Point 140 – “It should be noted that AUSTEL’s investigation of matters relating to the RCM problem has been hampered by Telecom’s failure to make available to AUSTEL a file specifically relating to the Pairs Gains Support investigation of the RCM. The file was requested by AUSTEL on 9 February 1994.”
Point 153 –“A feature of the RCM system is that when a system goes “down” the system is also capable of automatically returning back to service. As quoted above, normally when the system goes “down” an alarm would have been generated at the Portland exchange, alerting local staff to a problem in the network. This would not have occurred in the case of the Cape Bridgewater RCM however, as the alarms had not been programmed. It was some 18 months after the RCM was put into operation that the fact the alarms were not programmed was discovered. In normal circumstances the failure to program the alarms would have been deficient, but in the case of the ongoing complaints from Mr Smith and other subscribers in the area the failure to program these alarms or determine whether they were programmed is almost inconceivable.”
Point 158 – “The crucial issue in regard to the Cape Bridgewater RCM is that assuming the lightning strike did cause problems to the RCM om late November 1992 these problems were not resolved till the beginning of March 1993, over 3 months later. This was despite a number of indications of problems in the Cape Bridgewater area. Fault reports from September 1992 also indicate that the commencement of problems with the RCM may have occurred earlier than November 1992. A related issue is that Mr Smith’s persistent complaints were almost certainly responsible for an earlier identification of problems with the RCM than would otherwise have been the case.”
Point 160 – “It should be noted that it is hoped that a number of issues in regard to the Cape Bridgewater RCM will be clarified when Telecom provides the documentation requested by AUSTEL.”
Point 169 –" Documentation reviewed indicates that other network users attached to the Cape Bridgewater exchange did report problems similar to those experienced by Cape Bridgewater Holiday Camp. It is also clear that problems identified in the area would have impacted on other network users as well as Cape Bridgewater Holiday Camp."
Point 209 – “Cape Bridgewater Holiday Camp has a history of service difficulties dating back to 1988. Although most of the documentation dates from 1991 it is apparent that the camp has had ongoing service difficulties for the past six years which has impacted on its business operations causing losses and erosion of customer base.”
Point 210 – “Service faults of a recurrent nature were continually reported by Smith and Telecom was provided with supporting evidence in the form of testimonials from other network users who were unable to make telephone contact with the camp.”
Point 211 – “Telecom testing isolated and rectified faults as they were found however significant faults were identified not by routine testing but rather by the persistence-fault reporting of Smith”.
Point 212 – “In view of the continuing nature of the fault reports and the level of testing undertaken by Telecom doubts are raised on the capability of the testing regime to locate the causes of faults being reported.”
