Sydney cloud firm pulled into TAFE fraud case

A Sydney cloud services provider insisted he saw ‘nothing strange’ about subcontracting $55,000 worth of support services to the same TAFE manager who was signing off on the procurement.

The Independent Commission Against Corruption (ICAC) yesterday heard evidence from Jason Kinsella, the director of Cloud People and the one-time business associate of alleged fraudster Ronald Cordoba.

Cordoba is accused of using his procurement delegation at the Macquarie Fields TAFE campus to channel fraudulent contracts to his own companies.

In January 2014, Cloud People was engaged by Cordoba, on behalf of the South Western Sydney Institute of TAFE, to set up a $140,000 hosted private cloud to support a network infrastructure course being taught at the campus.

Soon after awarding Kinsella the work, however, Cordoba informed him TAFE wanted the manager's own business, managed service provider Storm Solutions, to deliver first and second level support under the deal - at a subcontractor’s fee of roughly $55,000.

Kinsella insisted Cordoba told him he had authorisation from the TAFE to take on the work, a point Cordoba continues to deny.

Counsel assisting ICAC queried whether Kinsella thought anything “smelt a bit fishy” about an arrangement where TAFE’s own ICT manager would end up selling services back into his own division.

Kinsella argued that he understood Cordoba had been promoted to the role because of his “commercial acumen”, demonstrated by the fact he ran his own IT services business on the side.

He also didn’t find it suspicious when Cordoba asked him - upon putting together a proposal for the work for the TAFE finance department - to “please dress it up with complex descriptions".

Ultimately, however, Cordoba ended up supplying none of the support services that he was paid $55,000 for, according to Kinsella.

The establishment of the private hosted cloud in the first half of 2014 experienced a number of teething issues in its first months.

“At that time the hosted platform wasn’t in any sort of state where first or second line support would be needed," Kinsella told the hearing. “By the time the platform was any state that first and second line support could be handed over, Mr Cordoba had effectively disappeared from TAFE."

Kinsella said he hadn’t been paid back the $55,000 by Cordoba. He has been suspended on full pay since August 2014.

Kinsella did, however, acknowledge that he continued to entertain the prospect of working with Cordoba well into 2015, when the suspended TAFE ICT manager was planning to set up his own registered training organisation, and enquired about deploying a similar platform.

Cordoba has already admitted to benefiting from the alleged false invoicing scheme to the tune of $1.7 million.

He is accused of using his financial delegation to sign off on invoices for a front company he operated and for work mostly never completed.