In what is shaping up as the biggest scandal ever to hit the Australian automotive industry, FCA Australia has filed court documents – obtained by GoAuto this week – that allege Mr Campbell misappropriated and misused more than $30 million of company money during his two-and-a-half-year term as chief executive, which ran from October 2010 to May 2013.
FCA Australia is seeking compensation, damages and court costs as well as a court declaration stating that Mr Campbell breached his contract of employment, his “implied duty of loyalty and fidelity and his fiduciary duties” to his ex-employer.
Allegations made in the same court documents include that FCA Australia was invoiced for renovations on the home of Mr Campbell’s successor, Veronica Johns, who resigned unexpectedly in October last year citing personal reasons.
The court documents indicate that, at this stage, FCA Australia is not seeking compensation from Ms Johns.
Off to court: Former head of Fiat Chrysler in Australia Clyde Campbell has been forced to defend allegations brought to the Federal Court by his former employer.
However, Mr Campbell is claiming the action was “scandalous” and was an attempt by FCA Australia to blacken his name, adding that the action would be found to be “wrong” and “embarrassing” for FCA Australia.
The claims filed against Mr Campbell allege he spent company funds with businesses either owned or controlled by himself, his wife Simone, friends and other business associates.
Among the claims in the court filings, FCA Australia alleges that vehicles were provided to three celebrity ambassadors in the United Kingdom, without any written contracts and without FCA Australia having a commercial presence in the UK.
It is also alleged that three cars that were said to be earmarked for use as prizes or to be donated to charities – specifically, the Shane Warne Foundation, the Prostate Cancer Gala Dinner Fundraiser and the NRL Dragons – were, in fact, redirected to other people, one of which was Ms Johns’ husband Gregory Hede.
Other examples of alleged direct or indirect misuse of funds include using company money for trips to New Zealand, Rio de Janeiro and New Orleans, and a three-year Victorian Racing Club membership for Mr Campbell and his wife worth $244,800.
FCA Australia also alleges that a company named My Alfa Romeo, of which Mr Campbell’s wife was a director and shareholder, charged it $550,000 for one or more mobile outdoor floating billboards that it never received.
In the court filings it states that FCA Australia “suspects” Mr Campbell used the money to pay for a 40-foot Chris Craft boat valued at more than $400,000.
Part of the claim includes the allegation that Mr Campbell had previously held a senior role at a company called Motortrak, which then contracted with FCA Australia shortly after Mr Campbell started his tenure as head of Chrysler Group’s operations in Australia in late 2010.
It is alleged that in late 2010, FCA Australia engaged Motortrak to provide web services for dealers with a subscription cost of $690 per dealer per month from January 2011, and that, within 18 months, the subscription cost increased sixfold to $4100 per month per dealer in August 2012. It is alleged that the increase was uncommercial and detrimental to FCA Australia’s interests.
In December 2010, FCA Australia – then Chrysler Group Australia – had 59 dealers and the cost of the Motortrak contract was $488,520, however as of earlier this month, the car-maker has 184 dealers and the contract has grown to an annual cost of $9,169,250.
FCA Australia has confirmed to GoAuto in a statement that it found inconsistencies in some documents that led to the court filing, but it could not elaborate further given the imminent court proceedings.
“During a routine audit, we discovered what at best appears to be incomplete documentation pertaining to certain transactions and vendor relationships initiated or approved by Mr Campbell during his tenure as CEO of FCA Australia,” the statement read.
“As such, we are seeking all relevant information he has on these matters. We will not comment further on the ongoing legal proceedings and let the statements set forth in our pleadings speak for themselves. As this is currently a matter before the courts, we cannot make any further comment.”
Mr Campbell’s solicitor, Sam Bond, who is yet to respond to a request from GoAuto to put forward Mr Campbell’s side of the story, told Fairfax Media that the claims against his client are “not only completely denied but considered scandalous” and suggested that it was an FCA Australia issue relating to internal politics.
“We are confident that, in due course, the allegations will be shown to be wrong and will be embarrassing for FCA,” he is quoted as saying.
“The fact that internal politics within FCA has caused it to want to tarnish the name of Mr Campbell who took the business to enormous levels of growth is as unfortunate as it is unfair.”
Mr Campbell announced in February 2013 that he was preparing to leave the company after joining forces with automotive industry veteran Neville Crichton to create the privately owned Fiat Chrysler New Zealand, responsible for the NZ distribution of Fiat Chrysler Group brands including Chrysler, Dodge, Jeep, Fiat and Alfa Romeo.
A spokesperson for Fiat Chrysler NZ confirmed to GoAuto this week that Mr Campbell – who owned a 50 per cent stake in the business, with Mr Crichton holding the other 50 per cent – was no longer a co-owner of FCNZ, and that it is now “wholly part of the Ateco Group of companies”.
The spokesperson said projects that started during Mr Campbell’s time with the company, including the plan to convert Dodge Ram pick-up trucks to right-hand drive for sale in Australia and New Zealand, will continue.
“It is business as usual and the Ram project, as part of the Fiat Chrysler New Zealand operation, is also on track and on time for its September launch,” the spokesperson said.
In an interview with GoAuto shortly after her shock resignation last year, Ms Johns – the first Australian woman to manage a car company in Australia – said she decided to cut her career in the automotive industry short to take care of her parents after the sudden illness of her father.
By Tim Nicholson
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