A NSW government minister is calling for the immediate suspension of a Labor councillor who was general manager of a building industry training company referred to police over allegations of fraud worth almost $450,000.
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Corrective services minister David Elliott, the member for Baulkham Hills, has written to local government minister Gabrielle Upton requesting that The Hills Shire councillor Ray Harty be "immediately suspended from civic office".
In his letter Mr Elliott says Mr Harty "is under investigation for fraud by the NSW Police".
"An investigation of this nature warrants questioning not only with respect to the execution of the role of councillors to act honestly and exercise a reasonable degree of care and diligence, but possesses the potential to impair public confidence in public administration if no action is undertaken to restore the proper or effective functioning of local governance," he writes.
Mr Elliott says that if the investigation finds Cr Harty engaged in "serious corrupt conduct" then he should be dismissed from the council.
A spokeswoman for Ms Upton said: "These allegations are part of an ongoing investigation. The Minister has asked the Office of Local Government to monitor the situation."
A police spokeswoman said: "A report has been received by police and an investigation into the allegations is underway".
Last week Fairfax Media revealed the allegations of fraud at Comet Training, jointly owned by the NSW branch of the Construction, Forestry, Mining and Energy Union and the Master Builders Association NSW.
Comet is alleged to have been defrauded of one amount of $223,000 and another of $220,000 over the course of more than a year.
The alleged fraud was uncovered in late November as the Comet board began closing down the organisation after its premises was sold.
Irregularities in the accounts believed to be related to invoices being raised for work never done were detected by the company auditors.
Comet is now in administration and the board, which has referred the allegations to police, says liquidators have been appointed "to thoroughly investigate the issue".
Cr Harty is the former general manager of Comet Training. He received the Medal of the Order of Australia in 2012 for services to the construction industry.
According to his biography, Cr Harty is a former state and federal secretary of the Australia Public Service Association.
He was also joint National Secretary of the Public Service Union and served on the Australian Council of Trade Unions (ACTU) Wages Committee during 1988-89.
He was re-elected to The Hills Shire council in September. Cr Harty declined to comment.
