Australian unit of ComfortDelGro probes media allegations of wrongful conduct
A2B Australia, a subsidiary of the transport operator, has engaged external legal counsel
AN AUSTRALIAN unit of ComfortDelGro is investigating allegations of wrongful conduct made by several media companies, and it is considering legal action.
In a bourse filing on Monday (Feb 17), ComfortDelGro said The Sydney Morning Herald and The Age, as well as 60 Minutes Australia had reported “serious allegations of scams and fraudulent taxi transactions”.
These transactions were said to be related to and against A2B Australia and its wholly owned subsidiary Cabcharge Payments. Both A2B and Cabcharge are indirect, wholly owned subsidiaries of ComfortDelGro.
The media companies had accused A2B, “the country’s largest taxi company”, of taking the public “for a ride”. The allegations came amid a leak of confidential files, which indicated that A2B’s senior staff had failed to prevent the fraud.
The article noted that A2B chief executive Nick Yap was warned by an outgoing senior compliance manager that it was “particularly troubling” that the scams involved “vulnerable sectors such as NDIS, aged care and hospitals”.
NDIS is Australia’s National Disability Insurance Scheme that supports disabled people under 65 years old.
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Yap was also reportedly informed by another compliance manager, who has since left the company, that “major fraud on the Cabcharge terminals goes back years and senior management was made aware”.
According to the article, the scams involve taxi drivers exploiting loopholes in the terminal and payment systems provided by A2B, to overcharge passengers. This benefits the driver and Cabcharge, which “pockets a percentage of every transaction on the terminal”, noted the report.
The scams are also said to involve the gaming of Cabcharge fare payment products which A2B supplies to state and federal agencies, companies, hospitals and other health and disability services.
Some names documented in the media report include Victoria Maroondah Hospital, aged and disability care company Villa Maria Catholic Homes, as well as the Peter James Centre, an aged and chronic illness care facility in Melbourne.
ComfortDelGro said: “The board of directors of the company wishes to state that the company and its subsidiaries have a zero-tolerance policy towards any kind of fraud and wrongdoing.”
“The matter is currently being actively investigated by A2B which has engaged external legal counsel to advise on the matter and has written to Nine to reserve its rights,” added the land transport operator.
It also noted that the company will continue to monitor the situation and provide updates on material developments.
Responding to BT queries, an A2B spokesperson said it “categorically rejects the false and misleading claims made by 60 Minutes, The Age and The Sydney Morning Herald that the company benefits from fraud.”
It added: “These allegations ignore the extensive measures we have taken to prevent and combat fraudulent activity in the taxi industry.”
ComfortDelGro Australia completed its acquisition of A2B in April 2024. Since the acquisition, A2B has implemented strict measures to prevent fraud, it told The Business Times.
These measures include two-factor authentication on Cabcharge cards, the introduction of direct meter integration for accurate fare recording, as well as technology that eliminates manual fare pricing, requiring all payments to go through the taxi meter.
A2B also removed the ability of handheld payment terminals, that were not directly connected to a taxi meter, to process Cabcharge payment products.
“A2B does not tolerate fraudulent behaviour and takes action against drivers engaged in misconduct. The company has also cooperated with authorities when required, ensuring that fraudulent activities are identified and addressed,” said the spokesperson.
“The claims made by 60 Minutes and its associated media outlets are not only misleading but also fail to acknowledge the extensive reforms A2B has introduced to prevent fraud in the taxi industry,” it added.
“Due to the serious inaccuracies in these reports, we are considering legal action and cannot comment further,” said the spokesperson.
The media platforms that reported on the matter are owned by Nine Entertainment. The Australia-based media company declined The Business Times’ request for comment.
Shares of ComfortDelGro were trading 2.2 per cent or S$0.03 lower at S$1.35 as at 11.15 am on Monday, after the announcement.
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