License article

Pet crocodiles tend to bite the hand that feeds

It is so much easier in the movies. The mobster wears a black shirt, a white tie and a snarl, while his girlfriend chews gum and gets about in tight leopard-print pants one size too small.

The good guy lives in the suburbs with his wife and kids but is prepared to put his life on the line because that comes with the territory.

The baddie drinks whiskey, kills people, bribes judges and sell drugs. He has no redeeming features.

The goodie eats cookies, drinks milk (low-fat) and coaches the local tennis team. He calls faults but has none.

But out here the lines between goodies and baddies becomes blurred when organised crime moves into legitimate industry. This usually happens one of two ways. Using black money, syndicates buy into legitimate industries to launder funds and lower prices to unsustainable levels, which destroys honest competition and creates a monopoly. Think Las Vegas in the 1950s.

Tony Mokbel, for example, had interests in shops, cafes, fashions, fragrances, restaurants, hotels, nightclubs and property development. Drug money means you can run a business at a loss and still profit from washing the dirty cash.


And these guys don't welcome healthy competition. When an ambitious fellow started to promote boxing nights in Melbourne, well-known heavies ''bought'' all the best tables and then refused to pay. He soon realised he needed to leave the ring to save his.

The second way to infiltrate is to be invited in by naive ''squareheads'' who think the gangsters' skill sets can be used to deal with security, dispute resolution and debt conflicts.

This is about as logical as putting a leash around a crocodile and calling it your pet. Sure, your enemies will take notice but you will be the one who ends up turned into a handbag.

The volatile union movement has been a traditional feeding ground for organised crime. Way back in 1957 when New York police uncovered a secret Mafia strategy meeting in Apalachin, more than one-third of the 57 men present gave their occupations as ''labour'' or ''labour-management relations''.

International organised crime expert John T. Cusack told a standing committee the meeting was a classic Mafia summit - effectively a crime convention without showbags.

In 1964 the same Cusack flew to Melbourne after a series of Mafia-style market murders and in his final report accurately predicted we would end up in exactly the same position.

He said that within 25 years, organised crime in Australia would move into labour racketeering and the building and road construction industries. He was right.

He recommended a specialist squad be set up to investigate such syndicates. He was ignored.

The trouble is, when it comes to unions and big business, many try to fashion the facts to support their political agendas.

To those on the right, allegations that unions have been infiltrated by outlaw bikies and other undesirables is proof they are run by toothless, tattooed Trotskyites.

To those on the left, it shows big business is run by cigar-chomping, cocaine-using, corrupt clods who dish out bribes before getting a gutful of fondue at Swiss ski resorts.

In the past few weeks the pages of this periodical have been dominated by revelations by investigative duo Richard Baker and Nick McKenzie of secret deals, standover tactics and corruption in the construction industry.

This leaves us with two questions. Is anyone doing anything about it, and do Baker and McKenzie ever sleep? (It is rumoured they nap upside down in the stationery cupboard like fruit bats for only 12 minutes a day while surviving on a diet of overripe bananas and overproof rum.)

In the US the FBI sees labour racketeering as an arm of organised crime just like drug trafficking, arms dealing and illegal gambling, and yet in Australia, despite repeated warnings, it has been largely ignored.

A 1980 confidential Victorian Bureau of Criminal Intelligence report claimed organised crime had already infiltrated the construction industry and compromised union officials.

But often police have shied away from these sorts of investigations because of potential political fallout.

Detectives once found a link between local construction unions and IRA terrorists. The ''soldiers'' flew into Perth under false names and were then sent to building sites around Australia to draw wages.

When the allegations went public, stern-faced politicians promised an exhaustive investigation. Instead we got a cover-up.

Later one senior policeman wrote a scathing report that said: ''We were advised not to pursue the issue of IRA soldiers entering Australia. The raising of money by the Sinn Fein in Australia, particularly in the building industry, was also an area that we were advised not to pursue.''

The report claimed whistleblowers were ignored and corruption concealed because governments didn't want to infect construction sites with industrial unrest.

And there is another reason such allegations are often ignored. It would require a taskforce investigation that is expensive and time-consuming, with no guarantee of success.

It is virtually illegal to write a story on organised crime without referring to the colourful Mick Gatto, who, among other things, acts as an industrial mediator, helping solve union disputes in return for handsome fees. He is in constant demand and these days has more retainers than the Great Ocean Road.

He has been spectacularly successful, which is why he drives around town in a shiny Rolls-Royce (appropriately a Silver Ghost model).

Mick says much of what is written about him is wrong, misleading and motivated by sour grapes.

And the truth is his last conviction was way back in about 1982 when he did about eight months over a burglary matter.

In 2004 he was charged with the murder of hitman Andrew Veniamin, whom he shot dead inside a Carlton restaurant, and was eventually acquitted after a jury accepted it was an act of self-defence.

Gatto lost 14 months of his life and 30 kilos off his tummy while he was kept on remand before the trial.

The Gatto experience is crying out to be turned into the crime/diet reality TV show - Fat Cell: Where the Bars Aren't Made of Chocolate.

Contestants would be locked in a maximum security unit, the personal trainers would be long-term inmates and the exercise regime could include chain gang work Cool Hand Luke-style.

Night-time entertainment would include singing fast food jingles accompanied by the haunting strains of a jailhouse harmonica. And the first contestant to lose enough weight to wriggle to freedom through an escape tunnel would be declared the winner.

Since Gatto walked from the Supreme Court a free man in 2005 he has rarely been far from the front page.

He has been refused a boxing licence, banned from the races and the casino, raised a fortune for charity and continues to dine at some of Victoria's poshest restaurants.

He has been targeted by the Purana taskforce, the Australian Crime Commission and the Australian Federal Police, and is probably Australia's most investigated man.

There are now more recordings of Gatto's telephone conversations than Richard Nixon in the White House (although Mick swore less). And despite all the investigations Gatto remains a free man; he says it is because he is now on the straight (but not so narrow) while they say it is because he is too cunning.

He rarely talks business on the phone, confides only in a few of his most trusted associates and tends to engage in key negotiation points when walking in public areas.

But that doesn't mean his troubles are in the rear-vision mirror. He has been slapped with a $10 million back tax bill that he says is a joke (although when it comes to money, ATO commissioner Chris Jordan is no stand-up comic).

So where are we now in this industrial hotpot? We have claims of kickbacks and cover-ups and we have politicians using the allegations to score points against each other.

Bribes, secret commissions, slings and standover tactics are illegal. This is not a job for an industry commission; it is the job of the police, as Cusack pointed out back in 1964.

We have to remind those in that business that it is a criminal offence to demand or pay a bribe.

A crook is a crook whether he wears a designer suit, a hard hat, a motorcycle jacket or a police uniform.

We need state intelligence units and the Australian Crime Commission to bring together all the threads into a report to establish the size of the problem well away from political hubris and recommend a measured law enforcement response.

And not all standover men are steroid-filled bikies ready to kick doors down to make a point (and a buck).

In a private business meeting in Sydney, a dapper little man explained there had been a small oversight relating to the agreed price for the sale of a modest hotel.

He suggested a clerical error meant the real price should have been $300,000 higher. When the buyer pointed out the contract was legal the older man quietly said it would be ''unfortunate'' if a fire rendered the hotel unusable.

The insistent gentleman was no stranger to unsolved arsons and was used to getting his own way.

He was the notorious Abe ''Mr Sin'' Saffron. The price was altered and he got his money - no questions asked.

Perhaps it is time police started asking some.