Audit Reveals Red Flags in $15 Million Queensland Cybersecurity Contract
A Grant Thorton audit has exposed serious irregularities in the Queensland government's awarding of a $15 million cybersecurity contract to Cryptoloc Holdings. The contract was terminated months later, with the state now seeking to recover nearly $1.5 million.
Key Findings
- Unverifiable Finances: Cryptoloc Holdings submitted financial records that auditors could not verify. The listed accountant could not be found in government registries or three major accountancy organizations.
- Ignored Warnings: Credit-check agency Equifax warned bureaucrats of two adverse events linked to the company's founder, Jamie Wilson. The audit found no evidence these warnings were considered.
- Flawed Process: The tender panel finalized its recommendation before receiving the Equifax report, indicating financial stability was not comprehensively evaluated.
- Suspicious Balance Sheet: Cryptoloc's balance sheet showed $2.432 million in bank account in August 2024—which auditors described as "highly unusual" given accumulated losses of $1.133 million.
Background
The audit, obtained by the ABC via Right to Information laws, details how the contract was awarded in September 2024. It was terminated months later after ABC News reports highlighted problems.
Cryptoloc Holdings was restructured from the main Cryptoloc group just before the tender. Jamie Wilson and his businesses donated over $320,000 to both major parties in the four years prior, with a large portion going to the ALP.
The audit noted that key stakeholders involved in the procurement could not be consulted after transferring to another department.
Political Reactions
Open Data Minister Steven Minnikin raised questions about the previous Labor government's handling of the contract, including why its value increased and why it was rushed before the election.
An opposition spokesman stated that procurement should be managed by departments independently and that robust processes should be in place.
Neither the LNP nor the opposition commented on whether donations linked to Cryptoloc should be returned.
Attempts to contact Jamie Wilson were unsuccessful; he previously denied any wrongdoing.