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Chapter Three - AUSTEL’S Second Quarterly Report

AUSTEL supplied the quarterly COT Cases Report (see Arbitrator File No/100) to communications minister, the Hon Michael Lee MP, on 13 April 1994. Points 5.31 and 5.32, in this AUSTEL report, highlight the continuing phone and fax problems encountered by the four original COT claimants’ businesses and AUSTEL directed Telstra to carry out the SVTs at claimants’ premises using AUSTEL specifications, to verify the phone services were now operating at proper working standard, but this did not eventuate. (See Open Letter File No/22)

On 15 July, 1995 AUSTEL’s previous General Manager of Consumer Affairs  provided me with an open letter noting:

“I am writing this in support of Mr Alan Smith, who I believe has a meeting with you during the week beginning 17 July.  I first met the COT Cases in 1992 in my capacity as General Manager, Consumer Affairs at Austel. The “founding” group were Mr Smith, Mrs Ann Garms of the Tivoli Restaurant, Brisbane, Mrs Shelia Hawkins of the Society Restaurant, Melbourne, Mrs Maureen Gillian of Japanese Spare Parts, Brisbane, and Mr Graham Schorer of Golden Messenger Couriers, Melbourne. Mrs. Hawkins withdrew very early on, and I have had no contact with her since.

During my time at Austel I pressed as hard as I could for an investigation into the complaints. The resistance to that course of action came from the then Chairman. He was eventually galvanised into action by ministerial pressure. The Austel report looks good to the casual observer, but it has now become clear that much of the information accepted by Austel was at best inaccurate, and at worst fabricated, and that Austel knew or ought to have known this at the time.”

Had the Government Communications Regulator AUSTEL/ACMA not concealed their Cape Bridgewater Holiday Camp covert report from the Minister for Communications and the arbitrator, the arbitrator would have been compelled to investigate as to whether my claims of ongoing problems was a valid claim. Below are just some examples of the information concealed from the arbitrator.

Before the arbitrations actually began 

Absent Justice - Austel+39s Adverse Findings

Before the arbitrations actually began, the arbitrator was provided with a report that was officially submitted to all parties involved in the first four arbitrations as well as various government ministers. This report, dated 13 April 1993, states, at point 5.78: “an agreed standard of service, being developed in consultation with AUSTEL [the then government communications regulator] to be applied to any case subject to settlement is essential”. It is clear from this 258-page report, and other similar statements made by AUSTEL, that no finding by the arbitrator could be brought down until Telstra had proved it had fixed all of the ongoing telephone problems being experienced by those entering settlement and/or arbitration. After all, what was the purpose of an arbitration process if the claimants’ businesses were still affected by the ongoing problems that brought them into the process in the first place?

Point 5.25, 5.29 and 5.32 in this public report (see AUSTEL Evidence File 1-A states:

“…Mr Smith was the first of the original COT Cases to reach an initial ‘settlement with Telecom. It is understood that he: identified the type of faults which his business had experienced. Mr Smith has informed AUSTEL that his major concern and stipulated condition at the time of ‘settlement’ was that his service should operate, and continue to operate, at normal standards”.

“The fifth of the original COT Cases, Mr Schorer, had particular concerns about Telecom’s limited liability and the impact that the limitations was likely to have on any claim he might make for compensation arising from an inadequate telephone service.  

“The fact that faults continued to impact upon the businesses in the period following the settlement shows a weakness in the procedures employed. That is a standard of service should have been established and signed off  by each party. It is a necessary procedure of which all parties are now fully conscious and is dealt with elsewhere in this report. Its omission as far as the initial ‘settlement’ of the original COT Cases  were concerned meant that there was continued dissatisfaction with the service provided without any steps being taken to rectify it. This inevitably led to a dissatisfaction with the initial ‘settlement’ and to further demands for compensation. To avoid this sort of problem in the future, AUSTEL is, in consultation with Telecom, developing –

  • a standard of service against which telecom’s performance may be effectively measured;
  • a relevant service quality verification test. 

In the case of at least six of the Service Verification Tests conducted at the COT-cases businesses including my businesses, NO supervised testing of those service lines were carried out by anyone other than the defendants Telstra i.e. NO independent arbitration umpire was present when these tests used by Telstra as defence documents were in attendance when they were conducted.  As shown in my own report titled Telstra’s Falsified SVT Report, Telstra fabricated their Cape Bridgewater SVT arbitration testing.

The attachments accompanying my reply to Telstra’s arbitration defence, which I provided to Dr Hughes in person and were never returned to me after my arbitration, confirm I challenged Telstra arbitration engineer Peter Gamble’s witness statement of 12 December 1994, in which he states he conducted the Cape Bridgewater Holiday Camp SVT testing and exceeded all of AUSTEL specifications. (See Telstra’s Falsified SVT ‘unmasked identities’) Dr Hughes’ award findings made NO comment on my challenge stating Mr Gamble perverted the course of justice when he submitted his report. Introduction File No/4-A and File No/4-B, the CCAS data (File No/4-F) and the falsified SVT information all confirm Mr Gamble mislead and deceived the arbitration process concerning the not-tested Cape Bridgewater Holiday Camp services.

The Senate Hansard (see Introduction File No/6) of 24 June 1997 confirms ex-Telstra employee, turned whistleblower, advised a Senate committee, under oath, that Peter Gamble was one of the two Telstra employees who told him the first five COT cases (and naming me as one of the five) had to be stopped at all cost from proving our claims.

The fact that Dr Hughes disallowed his own technical consultants the extra time they required to investigate my complaints of ongoing telephone problems, including my claims the SVT process was aborted, suggests Dr Hughes was clearly biased. My arbitration lawyers also thought the same (see Open Letter File No/51-C).

On 9 March 1995, after the Telstra Corporation had offered DMR (Australia), the arbitration technical consultants, an offer they could not possibly refuse and they pulled out of the COT arbitration process – leaving the COT cases stranded with no one in Australia left who they believed Telstra would not compromise. We four COT cases wanted to amend our claims and at the same time call for a halt until an honest technical broker could be found: impossible in the current situation with Telstra commanding power over most, if not all, of the technical consultants in Australia.

As a compromise, to avoid delaying the arbitration process, the TIO wrote to the four COT cases advising us Paul Howell of DMR Group Inc in Canada had agreed to be the principal technical advisor to the resource unit if we accepted Lane. David Read of Lane was ex-Telstra and therefore the COT cases should never have been placed in a position of having to accept Lane. We received many telephone calls and correspondence from the TIO, promising us that DMR (Canada) would be the principal consultants and assuring us our concerns would be looked after in this matter. Eventually, we accepted Lane as assistants to DMR,

It is quite obvious from the varying draft findings by Lane Telecommunications and the comparing of the DMR (Canada) and Lane Australia final report dated 30 April 1995, that Lane was secretly allowed to do all of the assessment to my arbitration claim material as well as conduct all site visits to the Portland and Cape Bridgewater telephone exchanges and my business premises. In effect, the TIO, those who took orders from him and the arbitrator, sold us out.

The AUSTEL report confirms the SVT process was to give the arbitrator a guide as to whether all problems registered by the COT claimants had been located and rectified. The arbitrator was unable to hand down his final decision until Telstra demonstrated that it had carried out the specified SVTs and proved to AUSTEL’s satisfaction that both phone and fax services to various COTs’ businesses were up to the expected network standard.

Even though AUSTEL expressed serious concerns about the obvious deficiencies in the SVT run at my business, Telstra still used these test result to support its arbitration defence. On 16 November 1994, AUSTEL wrote to the Telstra arbitration liaison officer under the heading Service Verification Test Issues, outlining its concerns regarding the deficiencies in the testing process conducted at the Cape Bridgewater Holiday Camp (see Main Evidence File No/2). Telstra’s CCAS data for the day testing took place at my premises (29 September 1994) confirms not one of the incoming tests connected to any of my three business lines met the regulator’s mandatory requirements.

In AUSTEL’s 16 November 1994 letter, it warned Telstra the Cape Bridgewater Holiday Camp SVT process was deficient. By the time I received this AUSTEL letter, in 2002, the statute of limitations allowing me to use this information in an appeal had expired. It is clear from Main Evidence File Nos/2 and 3 the SVT process at Cape Bridgewater Camp was not performed according to the regulator standards.

Absent Justice - Telstra Deficient

In response to AUSTEL’s letter noting Telstra’s SVT process was grossly deficient (see Main Evidence File No/2), the Telstra technician who performed the tests – and who was also part of the management team – replied.  In his 28 November 1994 letter to the government communications regulator, he stated:

“As agreed at one of our recent meetings and as confirmed in your letter of 16th November 1994, attached please find the detailed Call Delivery Test information for the following customers. …

“This information is supplied to Austel on a strict Telecom-in-Confidence basis for use in their Service Verification Test Review only and not for any other purpose. The information is not to be disclosed to any third party without the prior written consent of Telecom.” (See Arbitrator File No/98)

By what legal authority could this Telstra bureaucrat insist on confidentiality when Telstra was the defendant in my arbitration? How could a bureaucrat tell a government regulator what they could or could not do during an arbitration process?

In October 2008 and May 2011, the Administrative Appeals Tribunals (AAT) heard my two Melbourne FOI matters. The government communications regulator (AUSTEL/ACMA) was the respondent on both occasions. I had still not received my promised discovery arbitration documents from 1994. Later changes to Australian law render this authority irrelevant, so how can Telstra require confidentiality from AUSTEL employees working for the government communications regulatorArbitrator File No/110 is one of two SVT testing documents discussed in the 29 November 1994 letter from Telstra to AUSTEL. These two Call Charge Analyses System (CCAS) data printouts show there were not 20 mandatory SVT tests calls generated into each of my three service lines on 29 September 1994. That day, this particular Telstra engineer’s SVT monitoring equipment malfunctioned. The 60 test calls that were required to check faults on these three service lines, were not carried out: the lines were not held open for the 100-120 seconds required to fully test their functioning capabilities.

This same Telstra technician was named in the Senate Estimates Hansard of 24 June 1997 as advising Telstra employees that the five COT cases (including me) had to be “stopped at all costs” from proving the validity of our claims (see Open Letter File No/24). As part of my AAT submission, I provided both AAT and ACMA with a 156-page Statement of Facts and Contentions, plus a CD containing some 440 supporting exhibits. The ACMA chair and lawyers were given proof the author of the 28 November letter dictated what government regulators could or could not do during my government-endorsed arbitration, and that the writer swore, under oath (on 12 December 1994), the SVT tests exceeded AUSTEL’s specifications. The ACMA chair failed to act on this incriminating evidenceArbitrator File No/110Main Evidence File No 3 and the letter of 28 November 1994 (see Arbitrator File No/98) support my claims against certain public servants, employed by AUSTEL, who assisted Telstra to pervert the course of justice during my arbitration. Mr Friedman, senior AAT member, after hearing my claims, found them neither frivolous nor vexatious and supported my quest for justice.

Between 24 February 2008 and 14 January 2009, more than 15 letters addressed to various ACMA lawyers and the chair of ACMA show contradictions in Telstra’s SVT reports and its sworn witnesses’ statements. The documents provided during my arbitration process (which was known to be grossly deficient) were handed to both AAT and ACMA as part of the AAT submission. I also included proof that another set of tests – the Bell Canada International Inc (BCI) tests – submitted as evidence by Telstra during my arbitration – were also impracticable (see Telstra’s Falsified BCI Report masked identities and Main Evidence File No 3).

This matter was not investigated in conjunction with the deficient Cape Bridgewater SVT process. Two reports – one dated 10 November 1993, the other October 1994 – were both proved grossly inaccurate, yet the arbitrator relied solely on them and furthermore, accepted them as factual evidence. The senior executives of AUSTEL have been shown to be clearly negligent in their duties: this has had grave repercussions for all COT cases, particularly me. It has also had further repercussions for the general public and the integrity of the organisation they represent.

On 2 February 1995, one of AUSTEL’s bureaucrats attached COT Cases AUSTEL third quarterly report to his letter to the Hon Michael Lee, Minister for Communications and the Arts, which states:

“Service Verification Tests have been completed for seven customers. Reports have been completed and forwarded to six of the customers, and the seventh report is in preparation. All six of the telephone services subjected to the Services Verification Tests have met or exceeded the requirements established.” (See Open Letter File No/23)

It is important to consider this quarterly report in light of the letter AUSTEL wrote to Telstra’s arbitration liaison officer on 16 November 1994 (see Main Evidence File No/2) advising the SVTs conducted at the Cape Bridgewater Holiday Camp were deficient  and asking Telstra what they intended to do regarding this deficiency in the testing procedure.

Corroded Copper Wire Network 

Absent Justice - Corroded Copper Wire Network

In the world of politics and media misinformation that is attached to the NBN, there is one important issue that hasn’t been fully addressed – Does Australia’s copper network meet the original mandatory government regulatory requirements? If this question is answered honestly, it would directly affect billions of dollars in Commonwealth spending. Why? Well, most of the current government’s NBN policy is based on using the existing copper network to get the internet to businesses and residences, a process dubbed Fibre-to-the-Node (FTTN). The government has apparently chosen to go down this path because this how other countries upgraded from their copper networks and because the FTTN process is expected to provide the most productivity from the ailing networks before eventually switching to Fibre-to-the-Premises.

This situation however would have been quite different if the government regulator had ordered Telstra to purchase the correct Service Verification Testing (SVT) equipment needed to carry out the required COT arbitration testing (See Telstra’s Falsified SVT Report ‘unmasked identities’). Instead, Telstra left the choice of testing equipment to Bell Canada International Inc. and agreed to limit testing to calls to the main exchange, instead of the CAN – the copper wire between the exchange and the customer’s premises. Does this mean then that the Commonwealth government is actually responsible for what is now a major national telecommunication problem?

If Bell Canada had carried out the full end-to-end CAN testing, they would have certainly been able to warn Telstra and AUSTEL that an upgrade of the copper-wire network needed to begin immediately, in 1993. Just imagine where the telephone system would be in Australia today, if that had happened 23 years ago!

Although that didn’t happen, it could have because, early in 1994 (before the Casualties of Telstra arbitrations), I discovered Telstra had not told Bell Canada that the unmanned Bridgewater exchange, which all calls were routed through, could not handle the testing equipment BCI claimed to have used to generate the calls. If Bell Canada had known what that unmanned exchange could handle, then they may well have discovered it was the unmanned exchange’s corroding copper-wire network that was partly responsible for the Recorded Voice Message, “The number you are ringing is not connected,” that was ruining my business. That discovery might have led Bell Canada to realise Telstra was using them to cover-up how bad the rural network actually was, right around Australia.

We know Telstra deliberately misled the Senate estimates committee in September 1997 by providing false information in response to questions on notice and that the same thing happened again in October 1997. Since the Senate committee asked their questions on notice, they would have been compelled to advise the government Telstra, at the very least, had conjured up their Cape Bridgewater testing results. This major exposé would have led to more investigations and those investigations would surely have found that, in 1993, although the government ordered testing of the COT cases’ exchanges, this so-called testing was nothing but a total scam and that would have meant that the upgrading of Telstra’s rural network could have commenced sometime in 1997.

Australia is now footing an expense that would have cost much less (probably by billions) than what it now costs, 23-odd years later, all because of the misleading and deceptive advice that Telstra gave the Senate estimates committee hearing in October 1997.

Australia’s copper broadband infrastructure: view 

Service Verification Test Part-One

Absent Justice - Poor Copper Network

Any reasonable-minded commercial assessor, after seeing photos similar to the one shown or written advice from Telstra’s technical field staff explaining how bad the copper wire network was, would have demanded Telstra supply the four COT cases with evidence: evidence the Commonwealth Ombudsman, on 20 January and 24 March 1994 (see Bad-Bureaucrats-File-No/20), also demanded Telstra address regarding the four COT cases being denied access to documents supporting their claims. Had the assessor been truly independent, he would not have moved forward and/or allowed the claimants to abandon their assessment process until the four claimants received the requested evidence. As our webpage absentjustice shows, the arbitrator did not seek those documents through the commercial assessment process in order for the four claimants to see whether they had enough documented evidence to proceed with arbitration. The Front Page of shows both Senator Ron Boswell, on 20 September 1995, and Senator Alan Eggleston, on 23 March 1999, advised the Senate the COTs were forced into arbitration without the necessary documents to support their claims. With this admission by two senators, why do these COT cases’ claims remain unresolved?

Twenty Years Later

On 29 January 2014, CEPU representatives publicly showed similar photos to the one opposite demonstrating problems with the Telstra copper network, including some of the innovative solutions technicians had used.

Absent Justice - Telstra Copper Network

During the lock-up meeting at AUSTEL’s Queens Road office, Melbourne mentioned above, we discussed the aging network and alerted AUSTEL that in our opinion would continue to affect customers if Telstra did NOT carrier out proper CAN maintenance. Neither the chair nor the general manager of consumer affairs were shocked at the Freedom of Information documents we produced at this meeting showing Telstra had full knowledge it had major network problems in the customer access network similar to the one shown by the CEPU representatives. AUSTEL changed the subject and, in a roundabout way, the general manager of consumer affairs advised us the documents I had shown AUSTEL concerning the ongoing 008/1800/freecall problems were even worse than the estimated more than 120,000 COT-type complaints AUSTEL originally recorded. Unfortunately, during our arbitrations, as the conjured BCI and SVT tests showed our phone lines were now ‘fixed’, the arbitrator ignored our documentation.

It is also important to link how AUSTEL withheld its findings from the Hon Michael Lee MP, on 2 February 1995, regarding the deficient SVT conducted at my business with the way they also withheld information from the same minister regarding adverse findings concerning my business losses (see Main Evidence File No 15).

Everyone has, at some time, reached a recorded voice announcement (known within the industry as an RVA):

‘The number you have called is not connected or has been changed. Please check the number before calling again. You have not been charged for this call.’

This incorrect and misleading message was the RVA people most frequently reached when trying to ring my camp. While Telstra never acknowledged this, I discovered much later, among a multitude of FOI documents I received in 1994, a copy of a Telstra internal memo confirming, “this message tends to give the caller the impression that the business they are calling has ceased trading, and they should try another trader”.

Another Telstra document referred to the need for “a very basic review of all our RVA messages and how they are applied … I am sure when we start to scratch around we will find a host of network circumstances where inappropriate RVAs are going to line”.

It seems the ‘not connected’ RVA came on whenever the lines in or out of Cape Bridgewater were congested, which, given how few lines there were, was often.

For a newly established business like ours, this was a major disaster, but despite the memo’s acknowledgement that such serious faults existed, Telstra never admitted the existence of a fault in those first years. And, with my continued complaints, I was treated increasingly as a nuisance caller. This was rural Australia, and I was supposed to put up with a poor phone service – not that anyone in Telstra admitted that it was poor service. In most cases, ‘No fault found’ was the finding by technicians and linesmen.

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All of the main events as quoted in this unbelievable true crime story are supported by copies of the original freedom of Information documents linked in the text.

Clicking on these links with your cursor will automatically open a PDF of the exhibit/evidence that a crime was committed. Using this method and following the various file numbers discussed in our various pages, you will verify our story. Without those documents, most people would really struggle to believe that public officials and their lawyers committed the illegal offences they did.

Using the acquired evidence the way we have is possibly a world first.


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“…your persistence to bring about improvements to Telecom’s country services. I regret that it was at such a high personal cost.”

The Hon David Hawker MP

“I am writing in reference to your article in last Friday’s Herald-Sun (2nd April 1993) about phone difficulties experienced by businesses.

I wish to confirm that I have had problems trying to contact Cape Bridgewater Holiday Camp over the past 2 years.

I also experienced problems while trying to organise our family camp for September this year. On numerous occasions I have rung from both this business number 053 424 675 and also my home number and received no response – a dead line.

I rang around the end of February (1993) and twice was subjected to a piercing noise similar to a fax. I reported this incident to Telstra who got the same noise when testing.”

Cathy Lindsey

“…the very large number of persons that had been forced into an arbitration process and have been obliged to settle as a result of the sheer weight that Telstra has brought to bear on them as a consequence where they have faced financial ruin if they did not settle…”

Senator Carr

“I am writing in reference to your article in last Friday’s Herald-Sun (2nd April 1993) about phone difficulties experienced by businesses.

I wish to confirm that I have had problems trying to contact Cape Bridgewater Holiday Camp over the past 2 years.

I also experienced problems while trying to organise our family camp for September this year. On numerous occasions I have rung from both this business number 053 424 675 and also my home number and received no response – a dead line.

I rang around the end of February (1993) and twice was subjected to a piercing noise similar to a fax. I reported this incident to Telstra who got the same noise when testing.”

Cathy Lindsey

“A number of people seem to be experiencing some or all of the problems which you have outlined to me. …

“I trust that your meeting tomorrow with Senators Alston and Boswell is a profitable one.”

Hon David Hawker MP

“Only I know from personal experience that your story is true, otherwise I would find it difficult to believe. I was amazed and impressed with the thorough, detailed work you have done in your efforts to find justice”

Sister Burke

“All that is required for evil to triumph is for good men to do nothing”

– Edmund Burke