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Interview: Brad Norington, The Australian's chief reporter in Sydney -

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EMMA ALBERICI, PRESENTER: She was hailed as a hero of the working class, a whistleblower who exposed the multimillion-dollar fraud of a Health Services Union boss who'd engaged in fraud against some of the lowest paid workers in the country. Her partner was the vice president of the Fair Work Commission, one of the country's most powerful roles, earning around $500,000 a year. Together, Kathy Jackson and Michael Lawler presented as a glamorous power couple, Ms Jackson lauded as a brave defender fighting union corruption from within.

But there was an entirely unexpected twist to the story. Kathy Jackson, a supposed HSU whistleblower, was in fact the biggest fraudster of all.

NEWSREADER (August, 2015): Disgraced former union leader Kathy Jackson has been ordered to pay $1.4 million for misusing union funds.

EMMA ALBERICI: She used union funds to pay her mortgage, dine at fancy restaurants, pay off her car expenses, buy cameras, go on designer shopping sprees, international travel, artworks; she even used the money to fund her divorce settlement. Still, she denies she acted illegally.

JOURNALIST (Four Corners, Oct. 2015): Did you, Kathy Jackson, take $1.4 million from the HSU?

KATHY JACKSON, NAT. SEC., HSU, 2008-2015: No, I did not take anything like that or anything from the HSU ever - that I wasn't entitled to.

EMMA ALBERICI: Michael Lawler was embroiled in the scandal and made headlines himself when it was claimed he used his sick leave for more than nine months to work on her complex legal defence.

JOURNALIST (Four Corners, Oct. 2015): Is it possible that perhaps you have lost perspective? You've been caught up in a conspiracy theory or created one in an attempt to cover up your own wrongdoing?


EMMA ALBERICI: Brad Norington writes for The Australian newspaper. He's tracked this story behind Kathy Jackson and Michael Lawler in a lengthy investigation series. His new book, called Planet Jackson, is about to hit the shelves.

Welcome to you and you'll be able to read some extracts of your book over the weekend. Welcome Brad Norington to Lateline.

BRAD NORINGTON, AUTHOR, PLANET JACKSON: Thanks very much. Yes, it's appearing in the Weekend Australian.

EMMA ALBERICI: So the royal commission did recommend criminal charges be laid against Kathy Jackson. What is the status of the police investigation?

BRAD NORINGTON: Well there's been a police investigation underway for quite some time and it's very advanced. Obviously it's up to the police when they move, if they move, but I think it's fair to say that they are compiling a very detailed case. There has been at least one raid on Jackson's house south of Sydney where she lives with Mr Lawler and it's possible that she may face charges before the end of the year.

EMMA ALBERICI: And just remind us of the court findings that have already been made against her.

BRAD NORINGTON: Well this, as you know, is a remarkable story that's been going on for years. In Jackson's case, she has so much, if you like, already stacked up against her. It's indisputable, for instance, despite what she might say, that she stole $1.4 million from the Health Services Union over about a decade. And I say that because there's been a finding in the Federal Court and an order that she repay that money with interest and other costs that totals $2.5 million. That's never likely to be paid back because she's in fact declared herself bankrupt. But in the meantime, there are also critical findings by the Fair Work Commission against her. There's the police commission against her. There are recommendations of possible criminal prosecution against her from the royal commission into union corruption, where you'll remember she started out as its star witness because she was the supposed whistleblower of corruption.

EMMA ALBERICI: To the extent that you can say one thief is worse than another, how does her wrongdoing compare to that of Michael Williamson and Craig Thomson, who is - Michael Williamson, in his case, is serving a five-year jail term?

BRAD NORINGTON: He is. And I think it's fair to say that her corruption far exceeds that of Craig Thomson in dollar terms and is at least as bad or worse than Michael Williamson.

EMMA ALBERICI: Now she long claimed to have been the one to expose Craig Thomson's wrongdoing.


EMMA ALBERICI: Was that the case?

BRAD NORINGTON: Well she did take credit for it in the sense that she went to police on behalf of her union, but, as will be revealed in Planet Jackson, she in fact did tell people, including myself and another author, Erin Patrick, that in fact she was the person who leaked the original story to the Sydney Morning Herald in 2009 detailing Craig Thomson's alleged - well, now in fact proven misuse of union credit cards on prostitutes. In fact she never, never leaked that material because I've tracked down the source.

EMMA ALBERICI: And so how - how did it ever become exposed then?

BRAD NORINGTON: Well, the original story, you might recall, in fact broke - it's been a long running saga. It originally broke with a story leaked to a journalist in 2009. It then went very quiet for several years.

EMMA ALBERICI: But you say not leaked by Kathy Jackson?

BRAD NORINGTON: No, no. Leaked by someone else, a person who was most concerned about the tardiness within the Health Services Union. In fact an attempt to stifle any form of investigation into Craig Thomson. And I would go further than that. There is clear evidence in fact that Kathy Jackson at that time cooperated with Michael Williamson, who before she turned on him was her friend and mentor, she cooperated with Williamson in an attempt to stop an exit audit on all of Thomson's spending as a union official, and further to that, to unsuccessfully try to retrospectively authorise all of his expenditure, the bad expenditure between, the years 2002 and 2007.

EMMA ALBERICI: What was motivating her behaviour?

BRAD NORINGTON: Well at that stage, you see, she and Williamson were on the same side. They'd been a united faction, a united team for going on a decade. They were close, they were in the Labor Party right, they love the power and money. They were close, but she really wanted to help Williamson shut down that investigation into Thomson and it was only when it became unbearable for the entire HSU executive, including her, to basically smother it for any longer that a unanimous vote was taken and she reported Thomson to the police. Now within days of that, she in fact - this is throwing forward to 2011 - she turned on Williamson too. Now the reason she did that, I would argue, is two-fold. Firstly, she wanted to basically have a cover for our own wrongdoing because she had stolen so much money herself, so the whistleblower story, the whistleblower narrative was a very good one. And secondly, this was something that evolved over time, but she wanted to mount a back door takeover of the HSU. She would deny that, but the evidence is very compelling.

EMMA ALBERICI: Tell us, briefly if you can, a bit about her background and her rise to power dating back to well before she became known as Kathy Jackson.

BRAD NORINGTON: Sure. Well, her name by birth is actually Ekaterina Koukevous. She comes from a Greek heritage. Her parents migrated to Australia in the mid-'60s. Her father was a hardworking man and she had very good parents. She has very good parents. They're still alive. He worked for a car manufacturer. She went to school at Loreto Mandeville in Toorak in Melbourne. She went to the University of Melbourne. I think she was intoxicated by the politics and like many young people, the scene at university, and there she met a person who would become, as some people say, inseparable, a great friend in David Feeney and ...

EMMA ALBERICI: Who was only just today dumped from the shadow frontbench.

BRAD NORINGTON: He was indeed. They've been very close over the years. I'm not quite sure of the current status of it, but certainly right up until the recent royal commission, she and David Feeney were still on good terms.

EMMA ALBERICI: And before we run out of time, I note that you focus significant attention in the book on Bill Shorten and his appearance before the trade union royal commission.


EMMA ALBERICI: And despite the fact that ultimately he was exonerated by the commission of any criminal or unlawful activity, you don't seem convinced of his innocence?

BRAD NORINGTON: Well I put it this way, that, in my view, the royal commission gave Bill Shorten very lenient treatment. It's quite astounding that his deputy of the time he led the Australian Workers' Union, a fellow called Cesar Melhem, who's now in the Victorian Parliament, basically copped all of the blame from the royal commission. The royal commission was a very flawed process in many ways. I think they were really bashed, if you like, by Labor and the unions, very successfully, on the basis that it was a political witch hunt. But at the same time, Dyson Heydon, the royal commissioner, made some mistakes, for instance by making it all seem politically aligned to the Liberal Party when he, in a very silly way, agreed briefly to speak to a Liberal Party fundraising event. But throwing forward to what you're saying, the criticisms of the AWU, Shorten's old union, the recommendations for many of the criminal charges all happened under his watch and he walked away with nothing.

EMMA ALBERICI: And they were some pretty serious charges too. What to you screams out as the most significant?

BRAD NORINGTON: Well look, most of it relates to the receiving of secret commissions by the Australian Workers' Union. I think the broader scheme of things relates to keeping workers in the dark. I mean, union officials in Australia or anywhere are there to represent workers' interests and workers in many cases, such as the Thiess-John Holland East West Link in Melbourne had no idea that hundreds of thousands of dollars were being paid to the union while their union was meant to be negotiating on their behalf for the best conditions possible.

EMMA ALBERICI: Unfortunately, we have to leave this there. So much more to unravel in that story, ...


EMMA ALBERICI: ... but thank you very much for coming in.