Dylan Welch September 8, 2011
NSW Police have dropped their investigation into alleged credit card fraud by Labor MP Craig Thomson.
THE fraud case against the Labor MP Craig Thomson is effectively dead after advice from the NSW fraud squad that there is insufficient evidence to prove allegations he spent more than $100,000 on prostitutes, election campaigning and personal expenses.
The advice, sent to senior police yesterday, calls for the matter to be referred to Victoria Police - as any offence would have been committed there - but says they are unlikely to reach a different conclusion.
The news will be welcome in the Labor Party, which has struggled with dire opinion polls and a series of policy missteps.
Off the hook ... police say there is not enough evidence to charge federal minister Craig Thomson. Photo: Andrew Meares
Mr Thomson allegedly misused his Health Services Union credit card when he was its national secretary before entering Parliament in 2007. It is alleged he used more than $100,000 in union funds on prostitutes, general expenses and his election campaign.
The opposition vigorously pursued the allegations, revealed by the Herald two years ago, in a bid to have Mr Thomson criminally convicted and force a byelection in his central coast seat of Dobell.
Labor would most likely lose the byelection and the minority government would fall.
The NSW fraud squad spent almost two weeks establishing whether the allegations were strong enough to allow an investigation. Detectives examined a voluminous brief of evidence, including boxes of documents from the union as well as material uncovered during an abortive defamation action Mr Thomson launched against Fairfax.
It is understood the evidence lacked the ''smoking receipt'', substantive documentary evidence of Mr Thomson's alleged misuse, that would have allowed the launch of a full investigation.
It is unlikely the fraud squad's decision will be met with displeasure by the Police Commissioner, Andrew Scipione, who would have been uncomfortable having such a politically explosive matter under his purview.
The news will be a setback for the shadow attorney-general, George Brandis, who wrote to Mr Scipione laying out the allegations against Mr Thomson and urging police to investigate.
His involvement also sparked criticism of the Liberal Party, following revelations he had called the NSW Police Minister, Mike Gallacher, days before Mr Scipione received the letter.
Senator Brandis and Mr Gallacher argued that the phone calls were courtesy calls only but the federal government was critical, saying it suggested pressure had been brought to bear.
Since the NSW police began investigating the matter the HSU's national secretary, Kathy Jackson, has had a spade caked in dirt left at her house - underworld code for ''dig your own grave'' - and has suffered a breakdown and been admitted to a Melbourne hospital.
She authorised a 2008 inquiry into Mr Thomson's expenses while national secretary.
Mr Thomson has repeatedly denied he misappropriated union funds, and has said someone else used the credit card without his knowledge.
