A senior IT executive at the Commonwealth Bank of Australia has been sentenced to a maximum of six years and eight months for his part in accepting bribes in return for organising IT contracts with the bank.
Former CBA general manager of infrastructure engineering, Jon Gordon Waldron, was sentenced to the jail term last Friday following his conviction in May and will be eligible for parole on 13 July 2028.
In the NSW District Court on 8 May, Judge Phillip Mahony found Waldron guilty of seven counts of corruptly receiving money as a reward for facilitating business opportunities for IT vendor ServiceMesh.
He was also found guilty of three counts of assisting Keith Hunter, former CBA executive manager in charge of operations, IT security, application development and IT engineering, to corruptly receive money.
Hunter, who had previously pleaded guilty to the crime, and Waldron had concocted an elaborate plan to profiteer from an earnout clause outlined in the $427 million (US$282 million) sale of ServiceMesh to Computer Sciences Corporation (CSC) in 2013.
Following his guilty plea in 2016, Hunter was convicted and the sentence reduced to three-and-a-half-years in prison in exchange for assisting with the prosecution of Waldron.
No remorse for actions
At the sentencing on Friday, Judge Mahony said Waldron had continued to protest his innocence and had appealed his convictions.
He added that Waldron had not made any progress in his rehabilitation and was focused on how his offence only impacted him financially and emotionally, not how it had affected the wider community.
Waldron, a New Zealand national, and Hunter’s plan saw ServiceMesh supply McAfee software and Pivotal software – which was never used – to the CBA.
The agreement earned Waldron nearly $1.9 million, with payments received between 16 May 2014 and 16 December 2014.
Without both the McAfee and Pivotal deals, ServiceMesh would not have surpassed the earnout revenue target of $30.3 million (US$20 million).
With the revenue from the two deals, ServiceMesh became entitled to a further payment of over $148.4 million (US$98 million), Judge Mahoney outlined during the hearing in May.
The Judge found Waldron and Hunter found out about the earnout provision in the CSC deal to purchase ServiceMesh and used the information to their advantage.
“The accused [Waldron] played an integral part in progressing the negotiations and contractual arrangements for the McAfee deal notwithstanding in the short term the CBA derived little commercial benefit from it,” the judge concluded.
Both Waldron and Hunter agreed to split the deal into nine separate transactions to avoid scrutiny and to ensure the deal was finalised within the earnout period.
Hunter was also found to have discussed compensation for the two agreements with ServiceMesh founder and CEO Eric Pulier.
Waldron and Hunter had a close working relationship with Pulier and ServiceMesh sales consultant Brad Twynham, which eased the workings of their plan.
Waldron in particular had become good friends with Twynham, even organising Twynham’s buck’s party.
Pulier himself made the payments to the two CBA IT execs through ACE Inc, a corporation registered by him.
The judge found the CBA, at the time the payments were received, had no knowledge of the cash that had been exchanged and only became aware when Waldron’s account was scrutinised in November 2014.
Principal shareholder at ServiceMesh, Eric Pulier, has maintained he is not guilty of any wrongdoing.