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Updated ,first published
A board member of superannuation giant CBUS has resigned and a director is under internal review after separate allegations they have engaged in inappropriate relationships.
One of the CFMEU’s representatives on the CBUS board, legal officer Lucy Weber, stepped down on Thursday after this masthead revealed she had a secret relationship with her CFMEU boss, Zach Smith.
Smith was the CFMEU’s national secretary when it appointed Weber to the superannuation giant’s board in November 2024. While CFMEU administrator Mark Irving, KC, had ultimate oversight over Weber’s appointment and it is not clear whether Smith had a role in that process, Smith was among the most influential union leaders at the time.
Industry sources, unable to speak publicly, said Weber, who is also on CBUS’s audit, people and culture board subcommittees, failed to disclose their personal relationship to the union administration or to CBUS.
A CBUS spokesman said that Weber resigned from the fund’s board. Weber and Smith did not respond to calls for comment.
Smith was backed by state and federal Labor to reform the CFMEU in 2024, but quit the union abruptly last month.
The relationship between Smith and Weber left both organisations unable to manage potential, real or perceived conflicts of interest.
Her resignation came as the industry super fund launched a fit and proper person assessment of her and Earl Setches, a director of CBUS’s property arm.
“The CBUS Super board has commissioned a review of the fit and proper assessments of both directors, consistent with our fiduciary obligations,” a CBUS spokesman said.
The “fit and proper” person test is a regulatory requirement designed to ensure that key position holders have the necessary character, competence, honesty, and integrity to manage member funds. It is an assessment that is ongoing and can be reviewed when any new information comes to light.
Setches was filmed dining on a yacht with gangland figure Gatto in January. Both men are widely seen as influential figures within the Victorian branch of the ALP.
The meeting has renewed fears that Gatto is seeking to cultivate ties with powerful officials at a time when the CFMEU administration is trying to curb the underworld figure’s influence.
The video shows Gatto seated alongside Setches at a table with champagne, wine, beer and prawns.
Opposition treasury spokesman Tim Wilson has called for the federal government to launch an investigation.
“The prime minister is turning a blind eye because he’s the beneficiary of the CFMEU-Labor cartel, but in any other sector there’d be an immediate investigation into this conduct,” he said.
“When independent corruption watchdogs are saying $15 billion has been handed to organised crime through the CFMEU-Labor cartel, the idea that retirement savings might also be fair game is terrifying”.
Prime Minister Anthony Albanese said on morning radio: “Certainly, it’s clear that there was corruption in the CFMEU. That’s why we intervened, did something about it.”
Setches said he had no industrial relationship with Gatto but worked with him on his autism charity and was invited onto the yacht as part of a prize awarded during a charity event.
Garry Weaven, a leading industry super figure and former chair of IFM Investors, pointed to the explanation that Setches gave for being on the yacht.
“It demonstrates that you should probably be careful if you’re a public figure, about who you’re seen with. But he, Earl Setches that is, he did outline his explanation,” he said. “He’s made his explanation, people can judge that.”
CBUS Property is owned by the CBUS industry super fund and is one of the key drivers of its business. It builds and invests in property development projects around the country that employ large numbers of union members who are also members of the superannuation fund.
CBUS Property alone has a portfolio close to $8 billion and has a further $3.4 billion of development work in hand, according to its website.
The governance standards of the fund that manages $110 billion plus in assets have been challenged in the past amid concerns the fund was too influenced by the powerful union, whose members are the largest contributors to the super fund.
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Sarah Danckert is a senior reporter who specialises in investigations and corporate wrongdoing. She is a two-time Walkley Award winner, and has won six Quill Awards and two Kennedy Awards.Connect via X or email.
Clancy Yeates is deputy business editor. He has covered banking and financial services, and was previously national business correspondent in the Canberra bureau.Connect via X or email.From our partners
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