CASE PROGRAM 2008-64.1

Reorganising ’s approach to crime (A)

October 13, 1999: 29-year-old drug dealer and manufacturer meets sometime-associates Mark and in a suburban park in ’s north- west. The Morans, brothers and members of a notorious crime family, are in a dispute with Williams over a faulty batch of amphetamine tablets and decide to teach him a lesson. Jason Moran produces a gun and shoots Williams in the stomach, ignoring his brother’s instruction to “finish the job”.1 Little did they know that this fateful decision would spark a series of retributional killings that would claim more than 20 victims and take an under-prepared police force by surprise. By 2003, the frequency and audacity of the had increased considerably, leading media outlets to declare that Melbourne was in the midst of a “gangland war”. As detectives struggled to cope with the climbing body-count and growing public anxiety, senior members of Victoria Police were prompted to rethink the organisation’s approach to major crime.

Blood on the streets

Upon leaving hospital, Williams vowed revenge on the Morans and those close to them. Biding his time, he eventually achieved one of his main goals in June 2000, when was ambushed in his driveway and shot dead. This sparked a slew of further killings involving at least five of Melbourne’s criminal gangs, as responsibility was attributed (rightly or wrongly) and revenge sought. The deaths also created power vacuums and power struggles as members jostled for control of (mainly) the city’s drug trade. Some of the most notable killings included that of

This case was written by Marinella Padula, and New Zealand School of Government, for Professor John Alford and Professor Amanda Sinclair as a basis for class discussion rather than to illustrate either effective or ineffective handling of a managerial situation. The assistance of , , Paul Hollowood, Toni Campbell and Craig Howard is gratefully acknowledged, however they are not responsible for the content herein. Cases are not necessarily intended as a complete account of the events described. While every reasonable effort has been made to ensure accuracy at the time of publication, subsequent developments may mean that certain details have since changed. This work is licensed under Creative Commons Attribution- NonCommercial-NoDerivatives 4.0 International Licence, except for logos, trademarks, photographs and other content marked as supplied by third parties. No licence is given in relation to third party material. Version 7-05-2008. Distributed by the Case Program, The Australia and New Zealand School of Government, www.anzsog.edu.au.

1 ‘Untold story: Melbourne's underground war’ The Age, 1 March, 2007.

Williams’ associate Dino Dibra who was shot outside his home in October 2000; Victor Pierce, who was killed in his car outside a Port Melbourne supermarket in May, 2002; and Nick Radev who was gunned down on a suburban street in April 2003. By this stage, there had been close to a dozen suspected gang-related murders.

Missed opportunities

Like the Morans, Williams and his family had long been involved with organised crime and were no strangers to police. However, investigators initially underestimated the reach of his underworld connections and the size of his ambitions. Six weeks after his 1999 shooting, police (whilst conducting a fraud investigation) found $20 million worth of “speed” at a Broadmeadows house and Carl Williams hiding in one of the bedrooms. However, corruption allegations against two of the drug squad detectives involved saw the case delayed and allowed Williams ample opportunity to marshal resources and climb the criminal ladder.2 Later, police would hamper their own efforts:

“In the case of Mark [Moran’s] death, police suspected Williams from the start, so much so that his house was raided the next day. But internal police politics terminally damaged the investigation. Members of the drug squad, who had worked on the Morans for years, deliberately concealed information from the homicide squad because they believed their investigation was more important than a probe they thought would fail. Their prediction was self-fulfilling.”3

But the Homicide Squad’s difficulties went beyond pinning charges on Carl Williams. As its function was to investigate all suspicious deaths in Victoria, the squad was initially responsible for pursuing the “gangland” murders. However, it became increasingly apparent that many of the victims and perpetrators were linked in ways the squad was only beginning to understand. While the squad was extremely skilled at investigating individual cases, detectives were struggling to make much headway with this series of killings. Solid intelligence on the main players was lacking. Each victim had numerous potential enemies and suspects were often aware they were under surveillance. The pervasive criminal “code of silence” meant that the victims’ family and friends typically refused to assist investigators. Likely targets of future shootings also routinely declined police protection.

Another problem, according to the then Assistant Commissioner Simon Overland, was the disjointed, uncoordinated nature of the investigations. “For example,” he said, “if someone was shot and killed, it was a job for the Homicide Squad. If the victim was shot but survived, it went to the Armed Offenders Squad. If the shot was fired in Carlton and missed the target, the local Crime Investigation Unit (CIU) would investigate but if it happened in Sunshine, a different CIU would take it. And collaboration between the different units (and even within the same unit) was often very weak.”

2 ibid. 3 ibid.

2 The Purana Taskforce

Chief Commissioner Christine Nixon recruited Overland from the Australian Federal Police in early 2003 and appointed him Assistant Commissioner of the Crime Department. Overland, along with Nixon and a number of other senior officers, recognised that the current set-up was not working and agreed that it was time to reassess their strategy. In June 2003, The Purana Taskforce was launched, comprising detectives drawn from the Homicide, Armed Offenders, Fraud and Drug Squads, as well as technical specialists including surveillance experts and forensic accountants. Preference was given to detectives who had worked in more than one area and it was hoped that the cross-disciplinary approach would break down some of the barriers between squads and start to build a “big picture” understanding of the situation. Soon after its inception, the taskforce swelled to more than 50 members but privately, senior police knew they were starting from behind and that tangible results could be some time coming. Their instincts were right.

On 21 June, 2003 Jason Moran and associate Pasquale Barbaro were sitting in a van outside the Cross Keys Hotel in Essendon in northern-suburban Melbourne. Moran had been to watch his children at a nearby football clinic and they were about to leave when a masked gunman appeared, shooting them both dead. The children, who had been in the rear of the van, were uninjured. The case drew widespread media attention but would not be the only one to hit the headlines. From April to December 2003, there were seven gang-related killings, occurring at a rate of roughly one every four weeks. In October, suspected drug dealer Michael Marshall was killed in front of his five-year-old son outside his South Yarra home. Two months later, career criminal and Moran insider Graeme Kinniburgh was slain in his Kew driveway.4

While there was a break in activity over the New Year, March 2004 saw two more sensational killings. First, hit-man and Williams confidante Andrew Veniamin was shot dead in a Carlton pizza restaurant. Just over a week later, family patriarch was assassinated at the Brunswick Club (an inner-city pokies5 venue) while staff and patrons looked on. His drinking companion was also shot but survived.

Overland noted that generally the vast majority of crime reportage was devoted to a small percentage of major offences and the current situation was no exception. The issue was now receiving almost unremitting media coverage as Melbourne was declared the battleground of Australia’s bloodiest “underworld war”.6 Further complicating matters, there were suggestions of police involvement in the death of police informers Terrence and Christine Hodson in May that year.

Changing times

Criminal turf wars were a periodic phenomenon in Victoria and indeed in all jurisdictions but the latest episode represented a departure from the norm: “What was different about these killings,” explained Detective Superintendent Paul Hollowood, “was that the offenders seemed to be fairly indifferent to the fact that they would cause community concern. All of a sudden there was a real cold-bloodedness to the

4 ‘Melbourne's gangland killings’ Sydney Morning Herald, 1 April, 2004. 5 Poker (gambling) machine. 6 Silvester, J. et al ‘Shooting heightens fears of underworld war’ The Age, 23 July, 2003.

3 murders and it became very tit-for-tat. A lot of killing occurred within a short space of time which drew a lot of publicity. In the past, criminal groups would try to avoid drawing attention to themselves and would go to extremes to cover up a murder by hiding the body and so on. With this spate of killings, there wasn’t any of that. They wanted to be very public and send a message to the other group that they were serious about what they were doing.”

Indeed, the murders were unusually brazen. They often occurred in public, during daylight hours or in front of bystanders, including children. They weren’t confined to deserted industrial backlots or remote areas but could occur anywhere including upscale leafy-treed suburbs. The alleged perpetrators didn’t seem to shy away from their new-found notoriety but to revel in it. They also seemed unperturbed by police efforts; indeed, Carl Williams had nicknamed himself “The Premier”.7 As a result, perceptions were shifting rapidly. The police and government were accused of being indifferent to gang violence.8 Conversely, police had noted a degree of community complacency towards intra-criminal violence but that had now all but dissipated. The realisation had struck that it was only a matter of time before an innocent party joined the list of fatalities.

Melbourne’s safe and “liveable” reputation was also under threat. Comparisons were made between the city and 1920s Chicago,9 as well as the fictionalised accounts of gangster life depicted in The Sopranos or The Godfather.10 However, observed Hollowood, the irony was that Victoria’s crime rate was the lowest of all the mainland states and was actually in decline, as it had been since 2000. Even with the current killings, the homicide rate was still below the national average.11 Nonetheless, the Purana Taskforce was coming under increasing pressure from both commentators and the community. Internally, the directive to police was to stay focussed and ensure the job was done properly.

Another development involved the way criminal gangs pursued their interests. Said Hollowood: “Organised crime and the nature of it have changed dramatically over the last decade. In the past we had criminals who would concentrate on one particular crime. For instance, we’d see people who were professional armed robbers or car thieves or safemen. What started to change was that people were starting to offend in a variety of areas, driven mainly by the drug trade.” While Williams and Moran-type operations weren’t exactly innovators, police knew that there were many smarter and more discreet criminal networks emerging. These networks were increasingly diversified, globalised and dynamic. They were quick to exploit new money-making opportunities and were highly responsive to police initiatives. They were also able to move fluidly between legitimate and illegitimate operations to mask their activities. A crackdown in one area simply meant moving to a new product, market or tool. For example, technology was being used in ever more sophisticated ways to target victims or conceal perpetrators and proceeds.

7 ‘Untold story: Melbourne's underground war’ The Age, 1 March, 2007. 8 Shand, A, ‘Ganglands’ http://sunday.ninemsn.com.au/sunday/cover_stories/transcript_1482.asp 9 ‘Chicago comes to Melbourne’ The Gold Coast Bulletin, 12 June 2004 10 Gray, P. ‘Gang celebrity a crime’, Herald-Sun, 12 April 2004 11 Medew, J. ‘Victoria's crime rate 2nd lowest.’ The Age, 24 June, 2005.

4 Victoria Police had also made some changes in recent years, shifting its emphasis towards tackling “volume crime” such as burglaries. These offences, explained Detective Inspector Craig Howard, were the ones most likely to impact the average Victorian personally and strongly influenced their sense of safety. Overland noted that although much progress had been made (car theft, for instance, fell by 50 percent over a five-year period) the focus on other areas, including organised crime, had wavered. What hadn’t changed, observed senior officers, was the way Victoria Police was set up to tackle major crime. It still adhered to a fairly traditional 20th century model that was straining to cope with 21st century demands.

Victoria Police

In 2003-2004, Victoria Police consisted of close to 13,000 members, including almost 2200 unsworn staff who filled specialist technical positions or administrative roles.12 The vast majority of sworn staff were uniformed officers who performed the bulk of police work, while approximately 1300 members were detectives. Detectives were assigned to investigate the most serious and complex offences and had to undergo specialist training before acquiring the rank. Unlike many public service organisations, employees spanned several generations, from those in their early 20s to officers with upwards of 30 of 40 years of experience. In addition, members (especially detectives) tended to stay in the organisation on a long-term basis. There was a high rate of union membership amongst officers (over 90 percent) and The Police Association (TPA) was a very active, high-profile union. Detectives (particularly those from the Armed Offenders Squad) had a strong presence amongst TPA’s senior management and were highly influential in directing union policy.

In terms of policing jurisdictions, Victoria was divided into five separate regions described by Howard as “almost autonomous” (Exhibit A). Region 1 was exclusively metropolitan, while Regions 2 to 5 encompassed both urban and rural areas. Each region was headed by its own Assistant Commissioner (Exhibit B). The state’s 328 permanent police stations handled routine patrols and minor offences (for example theft or traffic violations) however, each region also had a Criminal Investigation Unit (CIU) with detectives to deal with more serious cases. Crimes that were especially serious in terms of victim or community impact were typically the responsibility of the Crime Department: a centralised investigative bureau located in Melbourne which comprised close to 600 detectives working across five separate divisions (Exhibit C).

Each division consisted of several branches or squads which were generally organised according to crime types. Within each squad, detectives were assigned to teams to work particular cases. Special taskforces were also established when necessary to deal with high priority incidents or investigations. Each squad had its own charter which designated which cases it would take, however some were more clearly defined than others. For instance, the Homicide Squad was responsible for investigating every suspicious death in Victoria. Meanwhile arson, for example, was a crime that could be investigated by the Crime Department or the regions, though the former tended to take the most extreme cases involving significant property damage. However, where there was overlap, noted Howard, there was sometimes confusion and conflict:

12 ‘Appendix C: Workforce Statistics’ Victoria Police Annual Report 2003-2004, p.58.

5 “The Crime Department detectives had the capacity to decide on any given day what they would and wouldn’t do. Whatever they didn’t choose stayed at the regional level. Each squad had developed their own charter which determined in advance what they were interested in doing but the charter wasn’t binding. Any time they got busy, they could disregard their own charter. That was causing some grief in the regions.”

The “brotherhood”

Another distinguishing feature of the Victorian Police Force was its organisational culture. Frequently termed “the brotherhood”, it reflected the strong sense of shared identity, camaraderie and trust between force members. The highly charged, challenging and potentially life-threatening nature of police work both forged and reinforced the need for such bonds. Officers (especially detectives), noted Business Services Manager Toni Campbell, were team-based and often spent more time with their colleagues than their families and needed to be confident that they could rely on their co-workers in difficult situations. Having arrived recently from the education sector, she had noticed many differences in the way the Police worked. Supervisor- subordinate relationships, explained Howard, were also important:

“The managers prioritise their relationships with staff above everything else. Above the organisation, its objectives or anything else. They’re not entirely to blame for that. We’re an organisation of more than 10,000 people with significant WorkCover costs and we tell them we will measure them on how they deal with their staff. If they have lots of people off sick or problem individuals then it reflects on them.”

However, as Campbell and others noted, police culture wasn’t exactly homogenous across the organisation. Detectives, for instance, differed from their uniformed colleagues in several respects. Howard observed that the demands of the job meant that detectives had to possess an assertive manner combined with a keen eye for detail. In addition, noted Overland, detectives spent a great deal of their time dealing with hardened criminals and the most heinous crimes. By contrast, uniformed officers, (especially those based in rural or regional locations) had more opportunities to interact with the community at large.

Crime Department culture

Even amongst detectives, there were discernible differences. The kind of work undertaken at the Crime Department meant that it was the preferred posting of most would-be detectives. As such, there was ample competition for positions and an internal sense that they were “the best of the best”, unlike those based at regional Criminal Investigation Units. By contrast, regional detectives often saw their Crime Department counterparts as conceited and unhelpful. Collaboration between the two groups was poor, Overland observed, and many interactions centred around disputes over workload. Campbell had heard many anecdotal reports about regional requests for assistance or access to specialist services going unheeded to the point where some CIU detectives stopped bothering to ask. The situation was exacerbated by what Howard termed “Kingdom Construction: a culture of attainment that measures the value of yourself on the extent of your resources, not the task outcome.” As a result, observed Campbell, equipment and specialists tended to be guarded quite jealously to the extent that Crime Department divisions and squads would often protect their resources from each other. “There’s very much an attitude of: my resources, my crew,

6 my team, my gear. When it’s actually the Crime Department’s, Victoria Police’s and the Government’s,” she said.

Squad culture

Individual squads too had their own distinct identities which, observed Campbell, manifested in their own logos, slogans and even dress codes. Armed Offenders Squad members for example were recognisable by their white shirts and black ties. They were known as the “hard men” of the force and a hyper-masculine culture prevailed. They were also known for “doing things their way” which reportedly involved some officers not only bending the rules but breaking them. The Homicide Squad was yet another subculture. Amongst all the squads, its positions were the most coveted, helping to enshrine its elite reputation. Members prided themselves on their professionalism and the significant expertise they developed. Overall, most squads had their own established way of “doing things” and the tendency to close ranks to “protect their own”. Once accepted to a squad, detectives tended to remain for many years, sometimes their entire career. However, joining the squads was not straightforward, as Campbell explained:

“In some of the squads you only got to work in them if you were a mate of, or knew an existing member. You could be a very keen and dedicated policeman that wanted to work in a particular area but you had no hope because it was a closed shop. For example, some squad leaders would advertise a position in the police gazette but they’d already know who they were going to give the job to. So basically it was a bit of a joke.”

The practice also created quite a few administrative headaches for Campbell. A lack of transparency around appointments meant that they were often challenged by unsuccessful applicants, effectively putting the position “in limbo” until the dispute was resolved. Similarly, moving detectives between squads or divisions in response to emerging needs was often a difficult process even though technically there were no barriers to doing so. Although squads allowed detectives to develop high-level skills in a particular area, the downside, according to Assistant Commissioner Overland, was that the squads and divisions had become very “siloed”. “They were very focussed on their areas of responsibility to the detriment of anything outside of that,” he said.

The case for change

Aside from internal power struggles, another main issue according to Overland was that the Crime Department had “no real clear strategic focus about what it was supposedly doing and no sensible way of assessing and managing workload.” Part of the difficulty was that at both an individual and an organisational level, police priorities could be changed in an instant by external events, shifting everything else to the backburner. Said Detective Superintendent Hollowood: “We had a kneejerk approach to things. If we didn’t have enough resources in one place we’d take them from somewhere else which perpetuated a problem in another area. Every time you shifted a resource around whatever was left behind became a future risk.” Organised crime investigations were very resource- and time-intensive; results often took years to achieve and couldn’t always be publicised. Another part of the problem, added Hollowood, was a distinct lack of useful information: “We couldn’t tell how well our

7 resources were being used because we didn’t know, for example, how much time, effort and money went into a single investigation. We needed to understand more about our own business.” Detective Inspector Howard observed that reliably comparing workloads was also problematic and as a result it was hard to pin down those squads that were chronically underperforming versus those that were genuinely overstretched.

Hollowood estimated that some form of organisational review occurred at roughly five-year intervals at Victoria Police but frequently failed to yield much in the way of improvement, “Those reviews tend to just shift the chairs around but in another five years time we’d be doing it all over again... Most staff have been so used to change processes that there’s a high level of cynicism about it. You can rebadge it, you can try everything you like but people tend to remember their last experience.” Not all reorganisations had been quite so benign. Business Services Manager Campbell recalled that one recent overhaul before her arrival had been dubbed “The Georgetown Massacre” in honour of the person overseeing it.

Combating change fatigue would be a challenge as detectives, especially, were adept at feigning compliance. And the old “command and control” method was waning, noted Howard: “Once upon a time in this organisation a phone would have rung from the Deputy Commissioner saying: ‘This is important to me, so it’s important to you.’ And it would have happened. But in this day and age, that doesn’t necessarily work any more.” Many detectives, noted Overland, also had strong media links; any misgivings would easily find a sympathetic ear. And any whiff of dissatisfaction would swiftly spell union involvement. Higher up, there were other obstacles. Campbell pointed out that unlike most organisations, senior members of the Victorian Police force had typically known each other for many years, some since when they were new recruits. As a result they tended to have rather fixed opinions of each other and were reluctant to oppose each others’ views because future promotions would depend on their colleagues’ assent. They also weren’t too keen on outsiders. However, there was considerable support at the top; Chief Commissioner Christine Nixon was strongly in favour of reform.

The state government was also keen to see change but as Hollowood acknowledged, unlikely to top up the Force’s $1.2 billion budget given that they didn’t have a clear picture about how resources were currently deployed. Redundancies were not an option and generous superannuation packages encouraged older members to hang on for as long as possible. Despite the restrictions, Overland believed that now was the time for a major reassessment of their approach to major crime. By mid-2004, the Purana Taskforce had started to make headway and the level of violence had subsided. As difficult as the criticism and loss of public confidence had been, he felt that the lessons of Purana could be applied more generally to the Force. But he was also aware that in making changes he would be putting his reputation on the line.

8 Exhibit A: Map of Police Regions

Source: Victoria Police www.police.vic.gov.au, accessed, October 2007.

9 Exhibit B: Executive Management Structure

Source: Victoria Police Annual Report: 2003-2004.

10 Exhibit C: Crime Department Divisions and Squads, 2003

Crime Dept Taskforces

Commander

Business Strategic Organised Services Directions Crime Violent Serious Major Major Crime Crime Drug Fraud

Tactical Exhibit Mgt Response Armed Homicide Investigation 1 Initial Action Offenders

Organised Crime Arson Prison Investigation 2 Investigation 1

Org Motor Vehicle Theft Missing Investigation 2 Persons Cold Casino Investigation 3 Case

Sexual Investigation 3 Crimes Asian

Computer Crime

Criminal Proceeds

Source: Boston Consulting Group, ‘A major crime management model for Victoria Police’, June 2005, p.9.

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