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Royal Commission focus shifts to Jackson -

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EMMA ALBERICI, PRESENTER: The Royal Commission into Trade Union Governance and Corruption has refocused its forensic microscope on the scandal-plagued Health Services Union.

Already, two of the HSU's former chieftains, Michael Williamson and one-time Labor MP Craig Thomson, have been convicted of defrauding the union.

But today, the commission heard of allegations of financial irregularities against the union's high-profile corruption fighter and whistleblower, national secretary Kathy Jackson.

Ben Worsley reports.

BEN WORSLEY, REPORTER: The whistleblower has become the accused. Kathy Jackson didn't appear at the Royal commission today, but ended up the centre of attention.

JEREMY STOLJAR, COUNSEL ASSISTING: In recent weeks, a number of allegations have surfaced in relation to Ms Jackson.

BEN WORSLEY: They include: that she used a $1 million of HSU members' funds to pay off two personal credit cards. That she withdrew around $220,000 in funds using HSU bank cheques and that her branch of the union made unauthorised payments to an account she controlled.

Kathy Jackson will respond to the allegations when she appears later this week.

One of her allies today offered a defence on her behalf.

MARCO BOLANO, HEALTH SERVICES UNION: Kathy Jackson's been placed under far greater scrutiny than Michael Williamson or Craig Thomson were for blowing the whistle. I know - I knew Kathy Jackson to run an effective union and there was no negative press about her before she went to the police.

BEN WORSLEY: Those two HSU figures Kathy Jackson helped bring down, Michael Williamson and Craig Thomson, have been convicted of defrauding the union. But their corruption isn't a focus of this inquiry. How it went unchecked for so long is.

JEREMY STOLJAR: How did this corruption flourish? Why was it not detected earlier? Why wasn't something done about it? What happened when it was detected?

BEN WORSLEY: Mark Hardacre's evidence went to all those questions. The former HSU official spoke out against Michael Williamson in the '90s and was basically bullied out of the union as a result.

MARK HARDACRE, FORMER HSU OFFICIAL: Isolation, intimidation and threats. We were sued for defamation as well as part of the tactics.

BEN WORSLEY: This strand of the Royal commission will sit until Thursday.

Ben Worsley, Lateline.