An undercover surveillance operation ordered by the Commonwealth Bank has embroiled the institution in a spying scandal, with senior MPs monitored and photographed by private detectives investigating one of its critics.
The bank hired security firm G4S to conduct ''Operation Lantern'', round-the-clock surveillance on consumer advocate and anti-banking lobbyist Michael Fraser between August 28 and September 1. G4S, which conducted the security operation for the London Olympics, claims it is ''a world leader in providing compliance and investigation related services''.
Illustration: Ron Tandberg
Internationally, surveillance operations by governments and private firms are attracting increasing criticism and allegations of infringing privacy.
In a memo obtained by Fairfax Media, the bank requested photographs of people Mr Fraser met to ''allow for the identification of individuals'', and said it was trying to confirm if Mr Fraser was receiving information from bank insiders.
'The Arbitrator': Michael Fraser.
On those dates Mr Fraser was travelling from Brisbane to Sydney to attend a fund-raising dinner for Coalition senator John Williams, who is part of a Senate inquiry involving CBA with Labor senator Doug Cameron.
Other guests included former NSW opposition leader Kerry Chikarovski, entertainer Kamahl and liquidator John Sheahan. It was organised by lawyer Stewart Levitt, who is behind a class action against the bank. Also attending was Geoff Shannon, an aggrieved CBA customer who established the Unhappy Banking advocacy group and barrister Geoff Slater who is acting for Mr Shannon.
Senator Williams said when he found out about the spying, his initial thought was "What the hell is going on here? Why am I being monitored by some mob employed by the Commonwealth Bank?"
He said he contacted CBA earlier in the week and organised a teleconference with two executives for an explanation. "They confirmed the photos had been taken by the security company and gave assurances to me that they had ordered the photos to be destroyed. They apologised profusely," he said. "I accept their apology."
CBA confirms it carried out surveillance and said it was of ''a person who has conducted a systematic campaign of harassment, intimidation and threats to one of our employees over many months''.
A spokesperson said the bank's concerns were such that it provided personal security to the employee and had contacted police. An apprehended violence order has not been filed. ''In only the most worrying circumstances do we consider employing surveillance and these cases are very rare,'' the bank said.
The surveillance was organised on August 23 and on August 28 Mr Fraser tweeted and posted on his Facebook page that he was attending Senator Williams' dinner that night.
The bank denied it had known about the fund-raiser. ''The only reason our surveillance came across the fund-raiser for Senator Williams was because the harasser attended it,'' the bank said.
The email from the bank instructed G4S to give updates throughout the surveillance. It said: ''There is some suspicion Fraser is being fed information from another employee of the bank but 'we have not been able to confirm this' ''. It said he was ''harassing'' a bank executive and seemed ''intent on destroying our employee's professional reputation and compromising his ability to work for the bank''.
The CBA says hundreds of emails, text messages and phone calls were sent to the bank executive but Mr Fraser says that over the past 10 months it was 68 calls, 30 emails and 23 texts.
One of the guests at the fund-raiser, Mr Shannon, said when he found out he had been spied on he wrote to CBA's lawyers Gadens questioning the bank's motives. Gadens wrote back: ''I am instructed that the bank has not sought to obtain, nor has it obtained, nor engaged anyone else to obtain, any photographs or information in relation to your client as alleged in your letter.''
Mr Fraser, who refers to himself as ''the Arbitrator'', said in the past year he had represented dozens of aggrieved CBA clients.
He told Fairfax Media his dealings with CBA began after a number of customers contacted him with allegations of loan fraud. He said he received standard responses to emails with an executive, then silence.
The text from Mr Fraser that triggered the bank's decision to undertake surveillance was: ''I am coming to Sydney for 4 days from 28 Aug until 1 Sep. More of your close team wish to meet with me privately in relation to their concerns about you. These ones wish to remain anonymous.
''Two major papers are very interested in the story and taking notes. I just want you to know that I don't dislike you, I just want to see the right thing done in relation to a handful of large matters you are involved in. Would you be open to meeting off the record privately when I am in town. You are welcome to pick the venue and search me for recording devices. I will honour my word. Michael :)"
A picture on the original version of this story was of Michael Fraser CEO of AGL Energy, rather than the Michael Fraser mentioned in this story.