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WiseTech: Sex, walkouts and now police raids · The Front

• 0:03
  Speaker 1: From the Australian. Here's what's on the front. I'm Claire Harvey.
• 0:06
  Speaker 1: It's Wednesday, October twenty nine, twenty twenty five. Lock up
• 0:12
  Speaker 1: your daughter's devices. That's the warning from Australian Federal Police
• 0:16
  Speaker 1: Commissioner Chrissy Barrett. She will today make a speech warning
• 0:19
  Speaker 1: parents that young men and boys are hunting, stalking and
• 0:23
  Speaker 1: grooming teenage girls online, forcing them to perform acts of violence.
• 0:31
  Speaker 1: A few questions about the Albanese government's ability to deliver
• 0:34
  Speaker 1: on its promise to fix housing. The flagship ten billion
• 0:37
  Speaker 1: dollar Housing Future Fund will be audited and treasuries design
• 0:42
  Speaker 1: of the scheme will be scrutinized. The fund was supposed
• 0:44
  Speaker 1: to build forty thousand new homes for low income workers,
• 0:48
  Speaker 1: but so far has built only the equivalent of about
• 0:51
  Speaker 1: eight houses. That story's life now at the Australian dot
• 0:55
  Speaker 1: com dot a you Tech success story Wise Tech weathered
• 1:02
  Speaker 1: allegations of sexual drama. Now it's being raided by the cops.
• 1:07
  Speaker 1: What's going on at Australia's most dramatic company. That's today's episode.
• 1:16
  Speaker 1: First it was sex.
• 1:18
  Speaker 2: I didn't hear from him.
• 1:19
  Speaker 1: I heard from his wife who told me in a
• 1:22
  Speaker 1: text message not.
• 1:23
  Speaker 3: To contact her husband ever again.
• 1:26
  Speaker 2: Thanks Mendez. I'm a journalist with the Australian.
• 1:29
  Speaker 3: Why have you resigned today?
• 1:31
  Speaker 2: I'm not talking. Are you concerned that that more women
• 1:33
  Speaker 2: are going to come out this night?
• 1:35
  Speaker 1: Then it was board chaos li chairman and three board
• 1:38
  Speaker 1: members of the software company wise Tech.
• 1:40
  Speaker 3: We'll step down this week due to disagreements over the
• 1:43
  Speaker 3: ongoing role of the founder, Richard White.
• 1:46
  Speaker 1: Now it's the fuzz us in.
• 1:48
  Speaker 2: Federal police and the Financial Services Regulator have rated the
• 1:51
  Speaker 2: offices of software giant wise Tech in Sydney. Officers executed
• 1:56
  Speaker 2: a search warrant to seize documents.
• 1:58
  Speaker 1: Wise Tech is a legit business founded by Richard White,
• 2:02
  Speaker 1: a former guitar technician and lighting engineer who grew a
• 2:05
  Speaker 1: billion dollar business out of his suburban Sydney garage. White's
• 2:11
  Speaker 1: a great example of the attractions of enormous wealth. He's
• 2:15
  Speaker 1: a charmingly scruffy kind of guy with a huge guitar collection,
• 2:19
  Speaker 1: who still lives where he grew up, in the unassuming
• 2:23
  Speaker 1: Sydney suburb of Bexley. But everywhere he turns there are uber,
• 2:27
  Speaker 1: glamorous women and drama. White is married to a woman
• 2:32
  Speaker 1: named Zena Nassa. Last year, he settled a messy financial
• 2:36
  Speaker 1: battle with another woman, Linda Rogan. A third lady named
• 2:40
  Speaker 1: Jenna Riches has gone public about their romantic entanglements, and
• 2:44
  Speaker 1: he was dragged into an ugly public dispute between politician
• 2:48
  Speaker 1: Mark Latham and his ex girlfriend. There were never any
• 2:53
  Speaker 1: allegations of criminality against White, but on Monday the dramas
• 2:58
  Speaker 1: turned from romance to shareholdings. Angelicas Snowden is a business
• 3:08
  Speaker 1: reporter with The Australian and she swung on to the
• 3:11
  Speaker 1: biggest story in business right now. It's what's going on
• 3:13
  Speaker 1: at Wisetich which was raided on Monday by corporate watchdog
• 3:18
  Speaker 1: ASSEK and the Australian Federal Police and what is allegedly
• 3:22
  Speaker 1: going on at Wisetich, Claire.
• 3:24
  Speaker 3: What we know has happened is Wistech's headquarters was raided
• 3:28
  Speaker 3: on Monday along with a number of other addresses. We
• 3:31
  Speaker 3: don't know where they are at this stage. We also
• 3:34
  Speaker 3: know that this is part of an alleged insider trading
• 3:36
  Speaker 3: investigation that the Federal Police and the Australian Securities and
• 3:41
  Speaker 3: Investments Commission are investigating.
• 3:43
  Speaker 1: Okay, let's have a look at insider trading first, what is.
• 3:46
  Speaker 3: That Insider trading is a criminal offense. Perhaps you're a
• 3:50
  Speaker 3: member of the public or an executive. You obtain information
• 3:55
  Speaker 3: that is not public and you use that information to
• 3:59
  Speaker 3: either buy or sell shares in a company. It's considered unfair,
• 4:04
  Speaker 3: which is why ASK the corporate watchdog is casting a
• 4:08
  Speaker 3: very very close eye on any allegations of this type.
• 4:13
  Speaker 3: It's been identified as one of the regulator's key enforcement
• 4:16
  Speaker 3: priorities this year.
• 4:18
  Speaker 1: Now, Wisetek's a really interesting company. It's a logistics business
• 4:21
  Speaker 1: based in Sydney, founded by a former guitar technician and
• 4:25
  Speaker 1: rody called Richard White, who's himself a very colorful character.
• 4:29
  Speaker 1: It's a public company, which means people can own shares
• 4:32
  Speaker 1: in it. They've released a statement revealing this raid. Why
• 4:35
  Speaker 1: did they do that?
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  Speaker 3: They are obliged to do that. It's interesting to note, however,
• 4:42
  Speaker 3: they disclosed the raids about twenty four hours after they happened.
• 4:47
  Speaker 3: I've been told that the announcement to the market could
• 4:50
  Speaker 3: have occurred earlier.
• 4:54
  Speaker 1: And what's Wistek's saying about the allegations that are at
• 4:57
  Speaker 1: the center of the raid.
• 4:59
  Speaker 3: Wistech is saying it understands no charges have been laid.
• 5:04
  Speaker 3: It has said in its statement that the documents police
• 5:11
  Speaker 3: were seeking were regarding alleged trading in wise Tech shares
• 5:15
  Speaker 3: by Richard White and three Wise Tech employees during the
• 5:19
  Speaker 3: period of late December to early January this year.
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  Speaker 1: Okay, now that brings us to the juicy part. Most people,
• 5:27
  Speaker 1: if they know anything about wis Tech, know that late
• 5:30
  Speaker 1: last year Richard White, the founder who's a big personality
• 5:34
  Speaker 1: in Australian tech. He's a real advocate for homegrown tech businesses.
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  Speaker 1: His campaigned very strongly for women to get jobs in tech.
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  Speaker 1: Allegations were raised last year publicly that he had met
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  Speaker 1: some women on LinkedIn and offered them business advice or
• 5:50
  Speaker 1: tips or perhaps mentoring in exchange for sex. Where did
• 5:54
  Speaker 1: all that end up in terms of what Richard White
• 5:57
  Speaker 1: was alleged to.
• 5:58
  Speaker 3: Have done, Perhaps I could start with Linda Rogan. In
• 6:01
  Speaker 3: the middle of last year, a Sydney based entrepreneur, Linda Rogan,
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  Speaker 3: sued mister White in the Federal court. She was seeking
• 6:12
  Speaker 3: to have a bankruptcy noticed set aside he had tried
• 6:16
  Speaker 3: to bankrupt her overclaims that she was seeking ninety thousand
• 6:21
  Speaker 3: dollars worth of luxury furniture for her house. What emerged
• 6:26
  Speaker 3: was Richard White had allegedly bought Linda Rogan a thirteen
• 6:30
  Speaker 3: million dollar mansion in Sydney as part of an arrangement
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  Speaker 3: where they would have sex and he would provide her
• 6:39
  Speaker 3: with business advice. Following that court case, a number of
• 6:43
  Speaker 3: other women came forward alleging very similar things happened to
• 6:48
  Speaker 3: them with mister White, including the business advice in exchange
• 6:52
  Speaker 3: for sex. Packed wise TEC's board began an investigation. Two
• 6:58
  Speaker 3: law firms, in fact, were asked to investigate these claims,
• 7:03
  Speaker 3: and in February this year, parts of our report into
• 7:07
  Speaker 3: that investigation were released. It did find mister White had
• 7:11
  Speaker 3: misled the board twice over his intimate relationships with some
• 7:16
  Speaker 3: women who had overlapped in their time with wis Tech.
• 7:20
  Speaker 3: But ultimately mister White stepped back from his job and
• 7:24
  Speaker 3: resigned from wis Tech for a period of several months.
• 7:28
  Speaker 1: Yeah, he stepped back a CEO, accepted a new title,
• 7:31
  Speaker 1: which was founding CEO that came with a million dollar salary.
• 7:35
  Speaker 1: But it seemed like the board of Wistech, you know,
• 7:38
  Speaker 1: wasn't really coping. Several members of the board resigned. Now
• 7:42
  Speaker 1: there are allegations that it was during that period when
• 7:45
  Speaker 1: he was ostensibly standing back, that he traded these shares.
• 7:49
  Speaker 1: If he did do that, what would be the problem
• 7:52
  Speaker 1: with that?
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  Speaker 3: If he did do that, that was during what's called
• 7:56
  Speaker 3: a blackout period. This is a period where key personnel
• 8:01
  Speaker 3: of a company are not allowed to engage in any
• 8:04
  Speaker 3: selling or buying of shares, and that is in large
• 8:08
  Speaker 3: part to prevent alleged insider trading from occurring.
• 8:17
  Speaker 1: Coming up where to from here. It's a really interesting
• 8:37
  Speaker 1: example of something they call founder risk, isn't it, Particularly
• 8:41
  Speaker 1: in startups where the founder is a big character. Often
• 8:45
  Speaker 1: they're an entrepreneur, they're a visionary. Sometimes that comes with
• 8:49
  Speaker 1: colorful behavior and a dramatic life, but their presence is
• 8:55
  Speaker 1: integral to the success of the business. In this case,
• 8:57
  Speaker 1: he built it from nothing to a forty bill dollar company,
• 9:01
  Speaker 1: and when he stepped back, the share price fell. It
• 9:04
  Speaker 1: seems to me like any way he handled this it
• 9:07
  Speaker 1: would have been bad for Wisetich because just not having
• 9:10
  Speaker 1: him there as the boss, the shareholders didn't like it.
• 9:13
  Speaker 3: Yes, Indeed, I think it's fair to say that over
• 9:16
  Speaker 3: the last twelve or so months, the company has performed well.
• 9:20
  Speaker 3: You know, we've had an AI boom. It's certainly performed
• 9:23
  Speaker 3: well off the back of that. However, we have observed
• 9:26
  Speaker 3: in periods where the court case and those other allegations
• 9:30
  Speaker 3: were occurring, there has been dives in the share price
• 9:33
  Speaker 3: and indeed, on Tuesday about five billion dollars has been
• 9:37
  Speaker 3: shaved off Wisetech's market value as a result of subsequent allegations.
• 9:42
  Speaker 1: It might be a good time to buy and if
• 9:44
  Speaker 1: you've got any cash lying around, perhaps what do we
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  Speaker 1: think of the next steps from here?
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  Speaker 3: It's an interesting question ask doesn't take these actions lightly.
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  Speaker 3: Insider trading is the most serious offense according to the
• 9:59
  Speaker 3: Corporations Act. It tracks a penalty of fifteen years jail
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  Speaker 3: for individuals who are found guilty of insider trading. Weistek
• 10:08
  Speaker 3: only used to get great publicity, but it seems that
• 10:11
  Speaker 3: the drama is here to stay now.
• 10:20
  Speaker 1: Angelica Snowden is a business reporter with The Australian. This
• 10:23
  Speaker 1: is a big story and you can read all our
• 10:26
  Speaker 1: reporting and analysis right now at The Australian dot com
• 10:29
  Speaker 1: dot au