The Gurney brothers hired a man they believed they could trust.

Ultimately that decision destroyed relationships, cost them over $10 million and took their company to the brink of bankruptcy as big-name bookmakers “preyed” upon a man known in the industry as “the Golden Goose”.

That man was family friend and relative by marriage Paul Montgomery.

He was hired to look after the books for their expanding family business specialising in earth moving and civil construction.

“Paul was like a sixth brother. His father used to train my father’s racehorses. We also had a common uncle, so he was more or less part of our family for a long, long time,” Wayne Gurney tells 7.30.

“Paul was an accountant, and our business was growing. Paul being family, we thought he’d be the perfect fit,” says Michael Gurney.

The Gurney’s business, RDS Civil, was run by five brothers — Wayne, Michael, David, Ian and Neal — from an office in Shailer Park, south of Brisbane.

The brothers were hands-on, laying pipes and concrete, building roads and bridges, developing blocks of land and tendering for new projects.

Montgomery took over the finances, while the brothers worked at various sites. Before long their, new accountant became the company’s general manager.

RDS Civil was landing good contracts and employing around 180 staff. They were completing big projects on time but something wasn’t quite adding up.

“It was like the reward wasn’t equalling the effort. We would come in here [to the office] absolutely fatigued on a Friday and just wonder, what are we doing wrong?” says Wayne.

Tensions began to build between the brothers over where the money was going and a legal dispute led to a forensic accountant being called in to inspect the company’s books.

‘Shocking’ a veteran forensic accountant

Dan Hains has been doing fraud investigations for close to 20 years, but nothing prepared him for what he discovered when he worked late into the night inspecting the accounts of RDS Civil.

He was uncovering large transfers from business accounts to personal accounts belonging to Paul Montgomery.

Montgomery’s personal credit card was then being used to deposit large sums of money into betting agency accounts.

“We uncovered more and more as we went along. In total, it was 17 different betting agency payments totalling over $11.5 million,” Mr Hains says.

The brothers were as shocked as the forensic accountant was.

“I was devastated, just absolutely devastated,” says David Gurney, who had known Montgomery since he was two years old.

“I remember, from three weeks to a month I’d just get up, go to work, come home, go to bed, didn’t speak to anyone.”

Wayne Gurney says the sense of betrayal was immense.

“Maybe we should have watched him closer, but we were busy working in the job, not on it. He was supposed to manage our finances.”

Mr Hains says around 60 per cent of the fraud cases he deals with are gambling-related, and that almost inevitably a sense of shame is felt by the victim.

“That’s what I see most often, is the shame that they should have known, that they trusted people,” he says.

“But frankly, business relies on trust. If we don’t have trust in business, everything falls apart.”

While Montgomery was ultimately to blame for his crimes, the brothers believe the sports betting firms encouraged and enabled his reckless gambling.

“I think they’re a pack of pigs who just prey on the weak,” says Wayne.

The Golden Goose

The brothers knew that Montgomery loved a punt. But with his encyclopedic knowledge of racing form, and the way he talked up his wins, they were sure he was a successful gambler.

“From what I thought at the time, I thought he was probably the best judge [of horses] I’d ever seen,” David says.

The brothers had no idea that Montgomery was on a multi-million-dollar losing streak that was being funded by them. They found out later that industry insiders saw him as a hopeless punter who was helping to line the pockets of the betting agencies.

“I didn’t learn this until after, but I heard he was in the top 5 per cent of punters in Australia,” says David.

In the world of online betting agencies, the business model is simple. Maximise how much losing punters can gamble and minimise how much the winning punters can bet.

The VIP Managers

Betting agencies target the biggest gamblers through a system of VIP managers who build personal relationships with punters, inviting them to sporting events and free lunches, making them feel special and showering them with “free” bonus bets that keep them gambling.

“They just used to fawn all over him like they were trying to become his best mate … to make him feel more important, to make him feel better. They stroked his ego. He loved that,” says Michael.

So-called “VIP clients” generate a large proportion of betting-industry profits. The UK gambling regulator found that one major betting agency took more than 80 per cent of its deposits from “VIPs” who made up just 2 per cent of their customer base.

During his decade-long losing streak, two former NRL players — Duncan McRae and Jess Caine — were among the sports betting salesmen who duchessed Montgomery, providing him with corporate hospitality and helping to encourage him to keep betting.

The Gurney brothers witnessed McRae in action when they were invited into corporate boxes as Montgomery’s guests.

“Duncan was the one who came down to Melbourne and the Magic Millions with [Montgomery] and The Championships in Sydney. Everything was laid on really, no expense spared, like food, alcohol, the corporate box,” says David.

According to the records compiled by forensic accountants, the betting agencies that McRae worked for, including BlueBet, received around $2.5 million from Montgomery over a seven-year period — money that had been stolen from the Gurneys.

Duncan McRae did not respond to the ABC’s attempts to contact him.

The forensic records show Montgomery deposited over $4.5 million with Sportsbet over the same period.

Former Rabbitohs player Jess Caine was a client relations manager at Sportsbet at the time. He is the brother of former NRL player and sports commentator Joel Caine, who has become a regular spruiker for Sportsbet on commercial TV and radio.

Emails obtained by 7.30 show Jess Caine inviting Montgomery to various sporting events and functions including the Golden Slipper, a dinner with State of Origin legend Darren Lockyer, as well as offers of free bonus bets.

Jess Caine did not return 7.30’s phone calls.

In the period when he was losing millions of dollars, Paul Montgomery was being paid an annual income of around $140,000.

Under anti-money laundering and counter-terrorism financing laws, betting agencies are meant to ask for proof of income to prevent criminal activity.

David Gurney says two betting agencies, Bet365 and Tabcorp, did ask Montgomery for proof of income.

“Bet365 sent an email to Paul requesting information regarding his salary, what amount of money he was on, and employer details. He said, ‘they don’t want me betting with them because I win too much.'”

The Gurney brothers believe that BlueBet and Sportsbet did not do the same.

When 7.30 asked BlueBet whether it asked Montgomery for proof of income, a public relations firm representing the agency responded via email, saying: “BlueBet has no comment … and declines the invitation for interview.”

In a statement, Sportsbet said: “Sportsbet cannot discuss the circumstances of individual customers. We adhere to our regulatory obligations and continue to strengthen our systems and processes.

“We take our responsibility for supporting safer gambling and mitigating the risk of financial crime very seriously.”

VIP managers at various sports betting agencies have been provided financial incentives to keep large punters gambling.

7.30 has obtained a contract for one of Sportsbet’s VIP managers from 2017, when Montgomery was gambling heavily. The contract shows commissions of up to 20 per cent being paid to its sales staff on their VIP customers’ net losses.

Independent MP Kate Chaney, who was a member of the parliamentary committee that held an inquiry into online gambling harm, says these commissions should be outlawed.

“During the committee process, we heard from some witnesses who had experienced this, and had been on the receiving end of staff being incentivised to maximise client losses,” she told 7.30.

Keeping the proceeds of crime?

When police charged Montgomery in 2020, they described the fraud suffered by the Gurney brothers as “one of the highest experienced in Queensland in recent history”.

At the time, police alleged he had stolen more than $10 million from RDS Civil over a 10-year period.

In October last year, Judge Dearden sentenced Montgomery to 10 years in prison with a non-parole period of two years and 10 months.

The Gurney brothers had recovered less than 10 per cent of the stolen money. That came from a civil settlement following the discovery that Montgomery had invested some of the stolen funds into property.

The rest of the money has proved harder to recover. Despite Montgomery’s conviction, the betting agencies who profited from his crimes kept the millions of dollars of stolen money he had gambled away.

“To me, it’s proceeds of crime. No one’s supposed to benefit from proceeds of crime, but it seems to me that they have,” says Michael.

Responsible Wagering Australia, an industry lobby group that represents five of the biggest betting agencies, declined to be interviewed for this story.

When asked on Radio National Breakfast last month about whether sports betting agencies should hand back stolen money, CEO Kai Cantwell said: “I think we have a justice system that deals with criminals in this country, and I think we should let them deal with the criminals and the repercussions of their actions.”

Michael Gurney says he spoke to lawyers about potentially taking action against the betting agencies to get their money back, but he was warned against it.

“They told us we were wasting our time and money. It wouldn’t be worth it,” he says.

In the UK, national regulator the Gambling Commission has fined betting agencies millions of pounds for accepting the proceeds of crime.

Australia does not have a national regulator. Many betting agencies set up offices in Darwin to benefit from lower rates of tax. This means many are regulated by the NT Racing Commission.

One of the parliamentary inquiry’s 31 recommendations was to set up a national regulator. The government has yet to give an official response to that recommendation, but in an interview with Sky News, Social Services Minister Amanda Rishworth gave a response that suggested it might not be on the government’s agenda.

“At this point, that is not in the discussions with states and territories. What is in the discussion with states and territories is around how we better coordinate,” Ms Rishworth said.

Wayne Gurney wants the Albanese government to pass all the inquiry’s recommendations.

“To me, the recommendations are quite easy to implement and they’re fair. Having a national or regulatory body that oversees all of it, and not just state by state, is a step in the right direction,” he says.

The Albanese government looks set to reject the parliamentary inquiry’s recommendation of a blanket ban on gambling advertising on TV — with reports that it instead wants to bring in a partial ban.

Ms Chaney says all the evidence provided to the inquiry shows that partial bans don’t work.

“The government’s response is deeply, deeply disappointing. And while they say that it’s about public health, it is clearly about protecting the broadcast media in an election year,” she said.

Communications Minister Michelle Rowland was not available to talk to 7.30 but in a recent interview on ABC Radio in Perth, she said the government was still in a period of consultation.

“Firstly, we are undertaking an orderly consultation process on this matter. We are doing this in a way that understands that there is a high degree of community concern. The second point is people want to see cultural change: advertising is one component of that,” she said.

The Gurney brothers have worked hard to rebuild their company. They want better controls placed on the betting industry to make sure that what happened to them doesn’t happen to others.

“They’re still ruining people’s lives,” Michael says.

“Something’s got to be done to stop what’s happening. It’s too late for us now, but I don’t want to see anyone else go through what we’ve been through because it’s not good.

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