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Aussie Manager Allegedly Gambled Away $11.3 Million

21 April 2002

AUSTRALIA -- April 20 2002 -- As reported by The Age: ``At just 39, Craig Telford was regarded as the `golden-haired boy' - the trusted protege groomed for a top job in the trucking empire of South Australia's richest man, 79-year-old Allan Scott.

``...Mr Telford yesterday appeared in a Queensland court, accused of gambling away $21 million (US$11.3 million) of his employer's money at the races. He consented to extradition to South Australia and is due to appear in an Adelaide court on Monday.

``The alleged fraud has not only devastated the stockmarket-listed K&S Corporation, but also sent tremors through the SA town of Mount Gambier, where after 55 years of business, Mr Scott's group is the biggest employer.

``...When Mr Telford was arrested yesterday, police found him at his $700,000 beachfront condominium in Maroochydore, where he was holidaying with his wife and three children. He was described as living `the flashiest lifestyle' in Mount Gambier, owning several houses in the district.

``Yet it was horse racing that had become his obsession. According to a statement of facts handed to the extradition hearing in the Maroochydore Magistrates Court, Mr Telford had gambled $21 million defrauded from K&S Corporation on horse racing. The statement said he had admitted to police that he owed millions to Sportsbet Australia and bookmakers in South Australia.

``...Still, Mr Telford's activities had attracted no suspicion in the Scott Group. Alarm bells only rang when a regular supplier told Mr Winser (Chairman and Scott's son-in-law) that a cheque had bounced. Company sources said this had never happened before.

``Mr Winser began an immediate investigation and within days Queensland police were asked to make the arrest.

``...Much of the money may be lost; police have located and frozen $3 million but K&S told the Australian Stock Exchange its profit this year would be slashed by $14 million.

``...Police said yesterday they believed it was the biggest case of alleged fraud involving a company employee. Australia's biggest fraud involved Alan Bond stripping $1 billion from Bond Corp in 1988-89..."

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