Allegations of fraud totalling almost $450,000 at an organisation part-owned by the Construction, Forestry, Mining and Energy Union and whose general manager is a Labor member of The Hills Shire council and Medal of the Order of Australia recipient, have been referred to the NSW police.
Comet Training - jointly owned by the NSW division of the CFMEU and the Master Builders Association NSW - is alleged to have been defrauded of one amount of $232,000 and another of $220,000 over the course of more than a year.
Representatives of the organisations have referred the alleged fraud to the NSW police.
It is understood Master Builders Association NSW executive director Brian Seidler gave a statement to Auburn police on November 29.
Fairfax Media understands 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.
Councillor Ray Harty, who was awarded the Medal of the Order of Australia in 2012 for services to the construction industry, was until recently general manager of Comet Training, which has been placed into administration.
Cr Harty was reelected to The Hills council in September. Contacted by Fairfax Media, Cr Harty said: "I've got no comment to make, it's in the hands of a solicitor. Bye".
According to his biography, Cr Harty is a former state and federal secretary of the Australia Public Service Association, where he was "responsible for the assets, income stream and national budget of approximately $10 million annually."
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 first elected to The Hills Shire Council in 2004 and served as deputy mayor during 2004-05.
In a statement the former Comet board of directors said: "An issue of financial irregularity on the part of COMET personnel was raised by the external financial adviser to the Board on 29 November 2017."
"Within 24 hours, of the Board receiving this information, the Board took steps to notify the police and appoint liquidators to thoroughly investigate the issue," the statement said.
"Independently from becoming aware of this issue and prior to this information being received by the Board from its financial adviser, the Board had already had resolved to wind up the company and cease operation due to the premises where the Company is located being sold.
"This matter is being independently investigated, and all further action as appropriate will be taken to ensure any damage to the organisation is mitigated fully. The Company is able to meet all its legal obligations to all staff and creditors".
Lidcombe-based Comet Training provided a range of training for the construction industry, from "lolly pop" traffic control to specialist skills in working at heights.
