Wherever he turns, Steve Vizard faces legal threats, accusations,
investigations, criticism and outrage. Every day there’s a new twist or
turn – so who can keep up with it all? To assess his overall position,
Crikey has constructed a scoreboard – nothing as fancy as the one Steve
used to refer to while relaxing over drinks in the Melbourne Cricket
Club committee room; more like those basic models you see at suburban
grounds. But as he’s now discovering, you don’t need a fancy scoreboard
to keep track of the score when the runs are piling up.

Breach of director’s dutiesVizard cut a deal with ASIC by pleading guilty to the civil charge
of breach of director’s duty, XXX PUT IN ACTUAL PENALTIES which will
see him face up to a five-year corporate ban and fines of at least
$390,000, after he admitted to trading shares in three Telstra
satellite companies – Sausage Software, Computershare and Keycorp –
while a director of Telstra.

Guilty as charged
Insider tradingAt this stage Vizard has not been charged with insider trading,
even though his publicly documented private share buying while a
Telstra director constitutes probably the most brazen case of insider
trading in Australian corporate history. The statement Vizard signed in
the civil action against him by ASIC cannot be used in a criminal case
of insider trading as it would not have existed if authorities had
launched criminal proceedings. But the possibility remains that he
could be charged over other share trading while he was a Telstra
director, or he could be charged with the criminal offence of insider
trading over the transactions to which he has already pleaded guilty if
new evidence or information appears. Crikey understands that ASIC has
not indemnified Vizard against further prosecution.

Possible further investigation
PerjuryThe Victorian Police fraud squad is believed to be investigating
whether Vizard perjured himself when he denied authorising illegal
trades while under oath during a 2003 Magistrate’s Court committal
hearing into theft charges against his former bookkeeper, Roy Hilliard.
Vizard refused the opportunity to repeat his denials under oath at
Hilliard’s trial this week, citing self-incrimination. Perjury is a
criminal offence.

Tax evasionThe ATO is likely to be looking closely at Vizard ‘s numerous
business interests, and aggressive use of charities and foundations.
Disgraced bookkeeper Roy Hilliard claimed through his lawyer in court
this week that Vizard had instructed him to move money offshore and
said he followed those instructions by stashing away $3 million at
Vizard’s request as part of a tax avoidance scheme – Vizard had earlier
alleged Hilliard stole the cash, but refused to testify at Hilliard’s
trial. Hilliard is also said to have occupied an office rent-free at
Vizard House in East Melbourne – a hostel for out-of-towners visiting
the sick – even though it only retained its tax exemption if Vizard
kept his business and charitable interests separate. Vizard’s luxury
holiday house in Port Douglas was also purchased in the name of the
Vizard Foundation – a charitable organisation that pays no tax.

Westpac’s $2 millionWestpac is reviewing court evidence relating to the $2 million the
bank paid to Vizard after he had claimed his former bookkeeper had
drawn unauthorised cheques. Last week the bookkeeper, Roy Hilliard,
said he had received just $438,000 of the missing $3 million caught up
in the false accounting case. Hilliard’s lawyer, Peter Hayes, QC,
questioned where the remaining $2.6 million had gone. “The money was
never looked for under any rocks of Mr Vizard here or offshore,” Hayes
said. In view of the court allegations and publicity around them the
question is: will Westpac, which is believed to hold a mortgage on
Vizard’s Toorak home, attempt to recover the $2 million from Vizard?

Other covert share trading while on the Telstra boardIn addition to trading in Sausage Software, Keycorp and
Computershare, Vizard also spent $650,000 buying shares in technology
companies ERG, Exodus and Extant, magazine publisher PMP Communications
and Channel 7 through his secret share-buying company Creative
Technology Investments, set up by accountant Greg Lay.

The art collectionThe Vizard Foundation was heavily involved in the art world through
the donation of paintings to various galleries. But two years ago
Vizard was questioned over allegations that he claimed tax deductions
on six paintings that were never purchased. Vizard was also noted for
his meagre donations to the National Gallery of Victoria while he was
president of the gallery’s trustees. It’s possible that all the
attention on Vizard’s activities could activate an ATO investigation
into the tax status of Vizard’s extensive (and expensive) art

“Hidden” business activitiesVizard is facing questions over his connections to The Communicate
Trust – an umbrella organisation grouping at least 11 companies in
advertising, TV production and public relations, run by his friend
Shaun Levin. It includes Melbourne advertising agency, See, which has
won accounts for the National Australia Bank, Commonwealth Games and
the National Gallery of Victoria since Vizard began work as a
“consultant.” This could be even more relevant when Vizard is
prohibited from managing companies as part of his penalty for breaching
his Telstra director’s duties by trading shares.

ReputationEven if he isn’t charged with any other offence, Steve Vizard has
utterly lost his reputation as a businessman, director, philanthropist
or as someone who can be credible in a public role. After the non-stop
tirade of allegations and disgust following the disclosure of his
impropriety as a Telstra director – and in other matters – it’s
impossible to imagine him ever again holding a public position of trust
or responsibility. In the court of public opinion he has already been
tried, sentenced and found guilty on all counts.

Guilty in the court of

Peter Fray

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