Mick Gatto, a prominent underworld figure, was paid over $1 million by a labour hire company to secure work on Victorian government Big Build sites, as revealed in the CFMEU inquiry. This payment arrangement has raised serious questions about corruption and influence in the construction industry.
Key Allegations in the CFMEU Inquiry
Integrity expert Geoffrey Watson SC testified that M Group companies, allegedly controlled by Gatto, paid him $1.04 million between 2016 and 2025. The payments increased in size and frequency over time, including $65,000 over six weeks in April 2020 and a single $77,000 payment in July 2022.
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Watson's report, "Rotting from the Top," alleged that Gatto controlled several M Group entities through "dummy directors" Michael Portia and Tony Paragalli. While Watson acknowledged he "probably shouldn't have said Mick Gatto owned them," he maintained that Gatto "controls" the companies.
Payments vs. Tax Debt
M Group Trades and Labour entered administration in May owing $13.7 million in tax. Watson highlighted the contradiction: "While a company is running up a tax debt of $13m, it is paying Mick Gatto $200,000. It was paying Gatto in preference to its employees. It was paying Gatto in preference to its tax debt."
| Payment Period | Amount |
|---|---|
| 2016-2025 total | $1.04 million |
| April 2020 (6 weeks) | $65,000 |
| July 2022 (single payment) | $77,000 |
| First half of 2025 | $200,000 |
Defense and Denials
M Group's barrister, Simon Wilson KC, argued that Portia and Paragalli "may" also own part of the companies, but Watson's central allegation remains that Gatto controlled them. Gatto, Paragalli, and Portia have previously denied all allegations.
Implications for the Construction Industry
This case underscores the need for transparency and accountability in labour hire arrangements, especially on government-funded projects. The payments to Gatto raise concerns about undue influence and the exploitation of workers.
Key Takeaways
- Mick Gatto received over $1 million from M Group companies over nine years.
- Payments were allegedly made to secure work on Big Build sites with CFMEU influence.
- The company owed $13.7 million in tax while paying Gatto $200,000 in 2025.
- Watson maintains Gatto controlled the companies despite initial wording.
- This inquiry highlights systemic issues in labour hire and union relationships.
FAQ
Who is Mick Gatto?
Mick Gatto is a well-known underworld figure in Australia, often linked to organized crime, who has been accused of controlling labour hire companies in the construction sector.
What is the CFMEU inquiry?
The CFMEU inquiry is a Queensland-based investigation into allegations of corruption and misconduct within the Construction, Forestry, and Maritime Employees Union, including links to organized crime.
Why did M Group pay Gatto?
According to testimony, M Group paid Gatto to secure work on Victorian government Big Build projects where the CFMEU had influence, suggesting potential corruption.
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