The Seven Network has been granted an urgent injunction to freeze the assets of one of its senior managers as a fraud scandal engulfs the broadcaster.
The New South Wales Supreme Court heard that Seven’s commercial manager of programming, John Fitzgerald, has admitted to falsifying invoices as part of what the court said appeared to be “a serious and ongoing fraud”.
Until very recently, Mr Fitzgerald was responsible for high-level accounting and financial reporting at the Seven Network and had responsibility for the finances of television production, sport, news and public affairs, overseas bureaux and programming.
He had approval to authorise individual payments up to $55,000.
The Supreme Court yesterday granted Seven preservation orders covering the assets of Mr Fitzgerald and his wife, together with two of his companies, as the broadcaster prepares to sue Mr Fitzgerald over what it alleges is a long-standing invoice racket.
As part of its application for the injunction — which was conducted without Mr Fitzgerald’s knowledge — the Seven Network told Justice Francois Kunc that an investigation had uncovered “payments going back over a number of years” to two companies of which Mr Fitzgerald was the sole director and shareholder.
The total amount of the alleged fraud was not quantified.
Justice Kunc said that Mr Fitzgerald had “apparently admitted that his assets include $1 million in a superannuation fund and $2.5 million in cash and shares”, as well as a property portfolio.
Fitzgerald assisting broadcaster with investigation
Seven was concerned that Mr Fitzgerald’s assets could be easily moveable, and convinced the judge to issue the asset preservation orders on an urgent basis.
Justice Kunc said that Mr Fitzgerald had been assisting the broadcaster with an investigation into the fraud.
“Mr Fitzgerald has now admitted to falsifying invoices and arranging and approving their payment,” Justice Kunc said.
“Even without the benefit of Mr Fitzgerald’s admission, the court would have been satisfied that there was a serious question to be tried.
“It is clear from the material before the court that a serious and ongoing fraud appears to have been committed by Mr Fitzgerald against his employer.”
Wife unaware of allegations, asset freeze
The ABC attempted to make contact with Mr Fitzgerald and spoke with his wife Michelle at their Sydney home.
Mrs Fitzgerald said she had no knowledge of the alleged fraud or that the couple’s assets had been frozen by the Supreme Court.
“I don’t know anything about that, sorry,” Mrs Fitzgerald said.
Seven did not allege that Mrs Fitzgerald knew about or participated in the alleged fraud.
The ABC has put questions to the Seven Network about the alleged fraud but has not received a response.