The allegations against the eight executives represented a fraction of the hundreds of fraud investigations conducted inside the department during the past two years.

A Herald investigation into corruption inside the federal government has uncovered irregular tendering, salary overpayments and massive regulatory failures within the agency.

Staff have been misusing corporate credit cards, travelling without approval and improperly awarding multimillion-dollar contracts, including one that was split to avoid an open tender.

The details have emerged in internal audit files that show more than 392 breaches of the Financial Management Act or its regulations in the past three years.

The Herald's inquiries have identified recurring information security failures.

A spokeswoman, Jodi Gatfield, said three executives were investigated in 2009-10, not eight. This is contradicted by a fraud report filled out by Edward Stanmore, the head of audit. Released under freedom of information, the document states eight ''senior executives/managers'', each with more than nine years' tenure, had been the target of internal fraud investigations.

Of the three she nominated, Ms Gatfield said two were found to have engaged in credit card misuse and another was accused of corruption but that this allegation was ''not upheld''.

Perhaps the most alarming were consecutive internal audits of procurement that identified systemic issues and warned of a need for ''substantial change in behaviour from those executing and approving procurement processes''.

A 2009 audit file noted ''high levels of non compliance'' in procurement, and that the agency might not be able to show ''tenderers were treated fairly and consistently''.

This was followed by a memo in June last year that cited ''widespread evidence'' of continued problems, including ''inadequate procurement processes''.

The audit said ''substantial improvement'' was required ''to deliver value for money and manage probity''. Last year DAFF spent more than $680 million.

In November 2008 a legal services contract was extended for 12 months and included a decision to increase its annual value by 42 per cent to $2,817,072.00.

The department requires legal advice for variations worth more than $500,000 but ''this policy was not complied with'', and there were no documents to show the variation represented value for money.

Last year a troubling purchase related to a conference event was found, which was ''split into two parts even though the intention was to select a single provider''. This avoided an open tender.

DAFF's control failures extend to the Australian Quarantine and Inspection Service, which polices agricultural imports.

AQIS staff are poorly trained and confused about their role, one confidential document says. A program to randomly inspect quarantine-approved premises did not work because staff were warned when ''unannounced audits'' were scheduled.

There is ''inconsistency'' in the way AQIS auditors ''instigate sanctions'', and such problems are hidden because of a ''lack of adequate management reporting functions''.

An audit report in March last year said the department was incurring an average monthly bill of $50,000 for salary overpayments, based on a snapshot of the first six months of 2009, with only $25,000 recovered over this period.

''While the department had identified this … in July 2009, planned reporting and corrective actions have not yet been fully implemented''.

Ms Gatfield said the agency had ''appropriate monitoring and management arrangements to detect issues, rectify them and consider and implement system and process improvements''.

Do you know more? investigations@smh.com.au