More Victorian schools ‘may have been used inappropriately’ to funnel away funds

Feb 27, 2017 by

Henrietta Cook –

Almost a dozen Victorian state schools are being investigated for potentially misusing taxpayer funds earmarked for needy students.

It follows explosive findings that a corrupt ring fleeced more than $6 million from the state’s schools, spending the money on overseas travel, alcohol and lavish lunches.


The Education Department is investigating 11 more schools who have have been used inappropriately as banker schools Photo: Andrew Quilty

In a report to the Independent Broad-based Anti-Corruption Commission, the Education Department said it had identified 11 more schools which “may have been used inappropriately as banker schools”.

A banker school was a school given large amounts of money by the Education Department’s central or regional offices on the basis they would share the funds with nearby schools when needed.

The scheme was abolished in 2015 after a damning IBAC inquiry found it was being abused by allegedly corrupt officials.

An Education Department spokesman said the schools would be audited to examine whether they were inappropriately used as banker schools.

“They were identified through a departmental analysis of returned banker school funds, with anything even slightly unusual or unexplained leading to the school being audited,” the spokesman said.

He said it was inappropriate to name the schools while the audit was taking place and at this stage, there was no evidence they had misused funds.

Cate Hall, the president of public school lobby group Our Children Our Schools, said the community had a right to know which schools were involved in the misuse of “sorely needed” public education funding.

“The banker schools identified by IBAC so far were predominantly in disadvantaged communities – where every extra dollar spent on students could have made a difference,” she said.

Last year, the Department clawed back $6 million from banker schools.

The system has been described as a “slush fund” for needy schools to pay for specialist programs.

The Department’s progress report to IBAC, which was published last month, also revealed that auditors descended on 269 Victorian schools last year and found that 28 per cent of them “needed improvement”.

Two per cent of schools were rated “unsatisfactory” and just 17 per cent received a “good” rating.

The audits focused on locally raised funds, cash, expenses, payroll, banking activities and school council governance.

The Department has overhauled its auditing regime and now targets schools which have been identified as having unusual transactions and a random selection.

It now uses a new data analytical tool to review eight million school transactions every year.

Six people have been charged in relation to the banker school rort including the Department’s former finance manager Nino Napoli.

Mr Napoli, the alleged ringleader of the scam, faces 152 separate criminal charges including dealing with the proceeds of crime, conspiring to defraud, perverting the course of justice and furnishing false information by producing false invoices for services that never existed.

Education funding was allegedly directed to companies run by his family between 2007 and 2014.

An IBAC report released last year said Mr Napoli obtained the school funds by “carefully selecting and grooming principals and business managers”.

“The conduct uncovered during IBAC’s investigation was underpinned by a malevolent culture of non-compliance and entitlement,” it said.

“Evidence suggests this practice to be pervasive and long standing.”

Source: More Victorian schools ‘may have been used inappropriately’ to funnel away funds

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