Lawsuit: Fiat Chrysler Australia Execs Blew Millions On Parties, Yacht

Illustration for article titled Lawsuit: Fiat Chrysler Australia Execs Blew Millions On Parties, Yacht

You know what must be a fun place to work? Fiat Chrysler Australia. Free cars for celebrities, wild parties in Rio and New Orleans, a yacht, and sweet deals for companies owned by executives — all on the company’s dime. Until the bosses in America found out, anyway.


That’s the subject of a growing scandal in Australia that revolves around how now-former Fiat Chrysler executives there spent corporate money, according to a detailed report in The Age. It goes into lengthy detail on the lawsuits against former managing director Clyde Campbell and Veronica Johns, pictured above.

Company money was used, directly or indirectly, to pay for a $400,000 yacht, a plane, trips to New Orleans and Rio de Janeiro, a golf and spa holiday in New Zealand, luxury villas at Crown Casino, Victorian Racing Club memberships worth $244,800, and more than $380,000 in gift vouchers.

Here’s the highlight reel of the accusations made against the party-mad Aussies:

  • Christmas parties at Crown Casino that cost $1 million a year
  • About $800,000 for a Fiat Abarth racing team with Campbell and another executive as drivers
  • Free cars for Fiat Chrysler “brand ambassadors” in the UK like Elizabeth Hurley, despite Fiat Chrysler having no brand ambassador program there
  • Authorizing $550,000 for a “mobile outdoor floating billboard” that turned out to be a sweet $400,000 40-foot yacht — and was purchased by a company co-owned by Campbell’s wife
  • A free car for Campbell’s wife’s hairdresser
  • Campbell ordered other employees to submit expenses for travel fees he himself incurred
  • $6.6 million to a company called Digital Dialogue Media toward “corporate website services” for Fiat Chrysler Australia, even though the company was part-owned by FCA marketing director Sam Tabart
  • A $145,000 annual lease on a property that just so happened to be owned by Campbell and his wife
  • “More than $30 million of contracts signed with companies allegedly related to either Campbell, his wife, former business partners or other senior executives with the company”
  • Payments of more than $4 million to a company owned by Campbell’s friend and ex-boss during the Daimler-Chrysler era, Ernst Lieb. Lieb was fired by Mercedes-Benz for using corporate funds to upgrade his house

The list goes on and on! What a bunch of kooks, those Australians!

Campbell’s attorney has denied the allegations. The whole thing started to unravel late last year when Johns unexpectedly quit and Fiat Chrysler brought in Pat Dougherty as the president and CEO of the Australian division.


When Dougherty took over, he faced a long line of employees ready to blow the whistle on the spending, and he reported it back to the superiors in Michigan. A team of forensic accountants started investigating in January, creating what employees called a funeral-like atmosphere.

According to The Age’s report, these alleged spending improprieties had been going on for years. So how did it go unnoticed for so long? It’s partially because of Fiat Chrysler’s big push into Australia, and the fact that Campbell was successful at pushing up sales numbers, and “as sales soared, Campbell spent.” In addition, thanks to the murky web of leadership created by Fiat’s merger with Chrysler, it wasn’t exactly clear who Campbell worked for and reported to.


At the same time, while Fiat Chrysler built market share in Australia, they weren’t ever really making much money on sales thanks to currency fluctuations:

“The Jeep campaigns worked, the public liked the product we were bringing in, but the fact is the Australian dollar was the key,” says the FCA insider.

“With the Aussie above parity, we could slash prices to build market share. The entire profit margin on a $65,000 Jeep Cherokee was less that $5000. Our rivals would want double that. While the dollar stayed high, we could get away with that business model.”


Good times all around!

Hat tip to Pieter!

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My 3 years at the Chrysler Tech Center we had a Little Caesars Hot n Ready pizza party. Once. I should have worked in Australia I guess.