1 00:00:06,000 --> 00:00:08,400 Speaker 1: You can listen to the fronts on your smart sneaker 2 00:00:08,520 --> 00:00:12,639 Speaker 1: every morning to hear the latest episode. Just say play 3 00:00:12,680 --> 00:00:14,200 Speaker 1: the news from The Australian. 4 00:00:21,840 --> 00:00:25,320 Speaker 2: From the Australian, here's what's on the front I'm Kristin Amiot. 5 00:00:25,440 --> 00:00:32,879 Speaker 2: It's Monday, September two. Anthony Abernezi's approval ratings have returned 6 00:00:32,920 --> 00:00:36,240 Speaker 2: to their lowest level since he became Prime minister. That's 7 00:00:36,240 --> 00:00:39,960 Speaker 2: according to new data from Newspoll. But the Opposition leader 8 00:00:40,000 --> 00:00:43,800 Speaker 2: Peter Dutton is facing similar skepticism from voters, with few 9 00:00:43,880 --> 00:00:46,680 Speaker 2: convinced the coalition would have a better handle on the 10 00:00:46,720 --> 00:00:50,320 Speaker 2: inflation crisis if it were in government. You can read 11 00:00:50,320 --> 00:00:53,080 Speaker 2: our experts analysis of those new numbers right now at 12 00:00:53,120 --> 00:01:00,560 Speaker 2: The Australian dot com dot au. Queensland's government DNA laboratory 13 00:01:00,600 --> 00:01:04,200 Speaker 2: has kept hundreds of sexual assault victims waiting for forensic 14 00:01:04,280 --> 00:01:07,200 Speaker 2: results for more than a year, and it's because the 15 00:01:07,280 --> 00:01:09,800 Speaker 2: lab is struggling with a backlog of more than forty 16 00:01:09,840 --> 00:01:14,480 Speaker 2: thousand major crime cases embroiled in a DNA disaster exposed 17 00:01:14,520 --> 00:01:21,120 Speaker 2: by The Australian's podcast Shandy Story more than three hundred 18 00:01:21,240 --> 00:01:25,039 Speaker 2: thousand dollars. That's how much Brisbane city Council was allegedly 19 00:01:25,120 --> 00:01:28,959 Speaker 2: robbed off by the scooter sharing company Beam Mobility last year. 20 00:01:29,800 --> 00:01:32,960 Speaker 2: Now the nation's biggest city council is kicking Beam to 21 00:01:33,000 --> 00:01:36,280 Speaker 2: the curb and it could have global ramifications for the. 22 00:01:36,280 --> 00:01:37,720 Speaker 1: Multimillion dollar company. 23 00:01:38,080 --> 00:01:48,680 Speaker 2: That's today's episode Scooters. If you live in a city, 24 00:01:48,720 --> 00:01:52,840 Speaker 2: you've probably been impressed or enraged by fleets of purple 25 00:01:52,920 --> 00:01:57,320 Speaker 2: electric scooters dumped on street corners, zooming down footpaths. 26 00:01:57,960 --> 00:02:00,240 Speaker 1: Love them or hate them, These scooters are his being 27 00:02:00,280 --> 00:02:01,280 Speaker 1: Brisbane and so. 28 00:02:01,240 --> 00:02:03,920 Speaker 3: A lot of people get random and if not, just 29 00:02:03,960 --> 00:02:04,520 Speaker 3: have a little bit. 30 00:02:05,240 --> 00:02:09,240 Speaker 2: In some places like Brisbane and Townsville, they're lined up five, 31 00:02:09,440 --> 00:02:10,960 Speaker 2: six or seven in a row. 32 00:02:11,760 --> 00:02:15,040 Speaker 4: I haven't personally ridden one of these scooters my children have. 33 00:02:15,720 --> 00:02:18,240 Speaker 4: I'm probably not as coordinator as I should be in 34 00:02:18,360 --> 00:02:20,680 Speaker 4: handling something so fast and nimble. 35 00:02:21,240 --> 00:02:25,080 Speaker 2: That's the Australians Queensland Bureau Chief Michael McKenna. He's a 36 00:02:25,080 --> 00:02:26,160 Speaker 2: bit of a novice. 37 00:02:26,600 --> 00:02:30,280 Speaker 4: But there's no doubt that the Beam Mobility scooters are 38 00:02:30,400 --> 00:02:35,160 Speaker 4: very evident. The purple livery is everywhere they share the city. 39 00:02:35,200 --> 00:02:39,359 Speaker 4: At the moment with their rival Lime Scooters, beam Mobility 40 00:02:39,680 --> 00:02:43,640 Speaker 4: has obviously now lost that contract and now it's up 41 00:02:43,639 --> 00:02:46,520 Speaker 4: to the city council to find one of its other 42 00:02:46,639 --> 00:02:50,440 Speaker 4: rivals to provide the other half of that cup of scooters. 43 00:02:51,320 --> 00:02:54,919 Speaker 2: Yep, Beam has been booted out of Brisie and it's 44 00:02:54,919 --> 00:02:57,880 Speaker 2: all because of a bit of creative accounting allegedly led 45 00:02:57,960 --> 00:03:00,120 Speaker 2: by its Yale educated founders. 46 00:03:00,639 --> 00:03:03,280 Speaker 4: So over the past month, the Australian newspaper has been 47 00:03:03,320 --> 00:03:07,799 Speaker 4: investigating be Mobility, which is the largest provider of e 48 00:03:08,000 --> 00:03:13,720 Speaker 4: scooters in Australia. That investigation was triggered by a complaint 49 00:03:13,720 --> 00:03:18,120 Speaker 4: by a whistleblower who later furnished US with reams of 50 00:03:18,280 --> 00:03:24,360 Speaker 4: internal correspondence both on slack and internal emails. The allegations 51 00:03:24,480 --> 00:03:27,440 Speaker 4: that were put to us was that the two founders, 52 00:03:27,560 --> 00:03:31,560 Speaker 4: Alan Jang and deb Yango per day and the number 53 00:03:31,639 --> 00:03:35,480 Speaker 4: of executives had cooked up a project whereby they were 54 00:03:35,520 --> 00:03:39,440 Speaker 4: deliberately exceeding the limit that was given by each of 55 00:03:39,440 --> 00:03:42,360 Speaker 4: the cities as part of the contract for the license 56 00:03:42,520 --> 00:03:44,720 Speaker 4: to put these scooters into those cities. 57 00:03:46,320 --> 00:03:49,800 Speaker 2: When be Mobility was awarded a license to operate in Brisbane, 58 00:03:49,880 --> 00:03:52,280 Speaker 2: it was allowed to have eighteen hundred scooters on the 59 00:03:52,280 --> 00:03:55,360 Speaker 2: ground at any one time. It agreed to pay a 60 00:03:55,400 --> 00:03:58,440 Speaker 2: registration fee of six hundred and fifty dollars per scooter 61 00:03:58,680 --> 00:04:02,119 Speaker 2: per year. US Brisbane City Council would take a cut 62 00:04:02,160 --> 00:04:04,840 Speaker 2: of the fee paid by riders every time they hopped 63 00:04:04,880 --> 00:04:07,600 Speaker 2: on a Beam scooter. That's more or less how it 64 00:04:07,640 --> 00:04:11,200 Speaker 2: operates in thirty six other cities around Australia and New Zealand, 65 00:04:11,280 --> 00:04:16,479 Speaker 2: including Sydney, Perth, Darwin, adelaide Cans, Townsville and Hobart. The 66 00:04:16,560 --> 00:04:19,799 Speaker 2: number of scooters as well as their functionality, is monitored 67 00:04:19,839 --> 00:04:23,920 Speaker 2: by a third party watchdog called ride Report. It partially 68 00:04:23,960 --> 00:04:26,760 Speaker 2: relies on data supplied by Beam and other ride sharing 69 00:04:26,800 --> 00:04:29,719 Speaker 2: companies like Lyme to kip tabs on the number of 70 00:04:29,720 --> 00:04:33,640 Speaker 2: scooters and bikes zooming around our cities. Ride Report then 71 00:04:33,680 --> 00:04:37,040 Speaker 2: sends that data back to its clients, that's the councils 72 00:04:37,040 --> 00:04:39,839 Speaker 2: where Beam has a license to operate. But if a 73 00:04:39,839 --> 00:04:44,200 Speaker 2: scooter status is marked as unknown, Ride Report doesn't count it, 74 00:04:44,560 --> 00:04:46,080 Speaker 2: and that's where things get interesting. 75 00:04:46,920 --> 00:04:52,240 Speaker 4: What we understand is that Beam were deliberately misleading ride 76 00:04:52,240 --> 00:04:56,840 Speaker 4: Report and pretending that the rideable scooters were unavailable or 77 00:04:56,960 --> 00:05:01,840 Speaker 4: unknown for reasons such as low battery or damage, and 78 00:05:01,920 --> 00:05:04,720 Speaker 4: that meant that those scooters that were actually on the 79 00:05:04,760 --> 00:05:09,880 Speaker 4: street didn't appear in the monitoring technology. The consequence of 80 00:05:09,920 --> 00:05:14,760 Speaker 4: that is that one it subverted the safety limits in 81 00:05:14,880 --> 00:05:19,000 Speaker 4: keeping the number of scooters on the streets to a minimum, 82 00:05:19,240 --> 00:05:25,160 Speaker 4: and also it allowed Beam to generate cash from the 83 00:05:25,279 --> 00:05:29,920 Speaker 4: rides from everyday users while not having to pay the 84 00:05:29,960 --> 00:05:32,720 Speaker 4: fees that it was supposed to pay to the Risen 85 00:05:32,800 --> 00:05:38,360 Speaker 4: City Council. In the correspondence that we've seen, Beam executives 86 00:05:38,839 --> 00:05:42,719 Speaker 4: boasted of potentially earning at least one hundred and fifty 87 00:05:42,800 --> 00:05:46,120 Speaker 4: thousand dollars a month from its Australian and New Zealand 88 00:05:46,200 --> 00:05:49,000 Speaker 4: operations through the Running Hot Project. 89 00:05:50,240 --> 00:05:53,360 Speaker 2: A tranch of documents and screenshots shared with Michael and 90 00:05:53,480 --> 00:05:57,040 Speaker 2: Senior reporter Sarah Elks by a whistleblower. So Beam was 91 00:05:57,080 --> 00:06:01,200 Speaker 2: allegedly fudging the numbers in Canberra, Townsville, Auckland and Wellington, 92 00:06:01,880 --> 00:06:04,880 Speaker 2: but Brisbane was the biggest money maker, with an extra 93 00:06:05,040 --> 00:06:06,760 Speaker 2: five hundred phantom. 94 00:06:06,360 --> 00:06:09,119 Speaker 1: Scooters deployed every day since last July. 95 00:06:10,080 --> 00:06:12,600 Speaker 2: It means Brisbane City Council has been robbed of more 96 00:06:12,640 --> 00:06:16,280 Speaker 2: than three hundred thousand dollars and it's not happy about it. 97 00:06:17,040 --> 00:06:19,360 Speaker 4: At the same time that we were given the documents 98 00:06:19,520 --> 00:06:23,680 Speaker 4: by the whistleblower. We also later learned that the whistleblower 99 00:06:23,680 --> 00:06:27,360 Speaker 4: had given similar not all of the documents to city 100 00:06:27,400 --> 00:06:30,520 Speaker 4: councils in Australia and New Zealand. They began to run 101 00:06:30,600 --> 00:06:34,640 Speaker 4: their own investigations and internal audits. The Brisbane City Council 102 00:06:35,080 --> 00:06:39,760 Speaker 4: has contacted me and shown me the findings of their 103 00:06:39,800 --> 00:06:44,280 Speaker 4: preliminary audit. The Brisbane City Council are now seeking some 104 00:06:44,360 --> 00:06:47,520 Speaker 4: of the extra documents that we have to use in 105 00:06:47,640 --> 00:06:51,560 Speaker 4: negotiations to recoup that lost revenues from the company. If 106 00:06:51,600 --> 00:06:55,880 Speaker 4: they don't cooperate with those negotiations or the city councils unsatisfied, 107 00:06:56,160 --> 00:06:58,720 Speaker 4: they've told me that they intend to take legal action. 108 00:06:59,240 --> 00:07:03,240 Speaker 4: They're also on Monday going to send a report to 109 00:07:03,279 --> 00:07:08,560 Speaker 4: the Australian Competition and Consumer Commission and also potentially make 110 00:07:08,600 --> 00:07:14,720 Speaker 4: a referral to the police. One of the more extraordinary 111 00:07:14,800 --> 00:07:17,080 Speaker 4: things that you can see in the documents that we've 112 00:07:17,120 --> 00:07:19,120 Speaker 4: been given by the whistleblower is the amount of people 113 00:07:19,200 --> 00:07:20,560 Speaker 4: that are allegedly involved. 114 00:07:21,080 --> 00:07:24,480 Speaker 3: The slack chat, which was titled war Room, had. 115 00:07:24,320 --> 00:07:29,080 Speaker 4: As many as twenty managers, legal counsel and the founders 116 00:07:29,200 --> 00:07:33,920 Speaker 4: involved in essentially running two sets of books, one set 117 00:07:33,960 --> 00:07:37,240 Speaker 4: of books for the regulators and the city councils that 118 00:07:37,280 --> 00:07:40,720 Speaker 4: they were providing the services, and another set of books 119 00:07:40,960 --> 00:07:44,360 Speaker 4: which were talking about the real amount of scooters that 120 00:07:44,400 --> 00:07:47,960 Speaker 4: were being deployed into these cities and the real amount 121 00:07:47,960 --> 00:07:51,680 Speaker 4: of money that they were making in revenues from users. 122 00:07:52,000 --> 00:07:55,400 Speaker 4: It was quite an extraordinary thing to have so many 123 00:07:55,400 --> 00:07:59,000 Speaker 4: involved in alleged conspiracy, and what usually happens when there's 124 00:07:59,040 --> 00:08:01,760 Speaker 4: so many involved in the conspiracy, it started to leak. 125 00:08:02,760 --> 00:08:06,440 Speaker 2: Beam Mobility's chief executive Alan Jung says there's a perfectly 126 00:08:06,480 --> 00:08:10,640 Speaker 2: innocent explanation for the discrepancy. In a statement to The Australian, 127 00:08:10,840 --> 00:08:13,800 Speaker 2: he said the company had marked certain scooters as unknown, 128 00:08:14,120 --> 00:08:17,840 Speaker 2: then deployed extras to fill the gap left by unwriteable vehicles. 129 00:08:18,680 --> 00:08:21,520 Speaker 2: He acknowledged that approach meant that sometimes they exceeded the 130 00:08:21,600 --> 00:08:25,560 Speaker 2: vehicle allocation stipulated by their license, and he said he 131 00:08:25,680 --> 00:08:29,360 Speaker 2: was deeply apologetic for the mix up, but he rejected 132 00:08:29,400 --> 00:08:32,560 Speaker 2: the suggestion it was a scheme to deprive councils of revenue, 133 00:08:32,920 --> 00:08:35,960 Speaker 2: and said Beam will revise its processes to ensure it 134 00:08:36,040 --> 00:08:37,000 Speaker 2: doesn't happen again. 135 00:08:37,880 --> 00:08:39,679 Speaker 1: That may be too little, too late. 136 00:08:40,520 --> 00:08:44,360 Speaker 4: Last week, the Auckland City Council canceled their contract with 137 00:08:44,440 --> 00:08:48,240 Speaker 4: Beam Mobility because of similar allegations and have referred the 138 00:08:48,280 --> 00:08:52,320 Speaker 4: matter to New Zealand Police for investigation. The Wellington City 139 00:08:52,320 --> 00:08:56,719 Speaker 4: Council has also canceled their contract and there are investigations 140 00:08:56,880 --> 00:09:02,320 Speaker 4: that we know of in Touncil Darwin, Hobart in Australia. 141 00:09:02,240 --> 00:09:04,200 Speaker 3: As well as several other cities. 142 00:09:04,920 --> 00:09:07,280 Speaker 1: It's a bungle that could cost Beam darly. 143 00:09:08,160 --> 00:09:11,640 Speaker 4: We've been contacted by the South Korean government through information 144 00:09:12,400 --> 00:09:15,600 Speaker 4: and we know that Beam already operates in about sixty 145 00:09:15,679 --> 00:09:19,920 Speaker 4: cities globally and their market share has been increasing, really 146 00:09:19,960 --> 00:09:24,960 Speaker 4: booming out of site in Turkey, Japan, Indonesia, Malaysia, Thailand, 147 00:09:25,080 --> 00:09:27,880 Speaker 4: South Korea and obviously Australia and New Zealand. 148 00:09:28,000 --> 00:09:29,920 Speaker 3: This is a red hot tech company. 149 00:09:30,320 --> 00:09:33,640 Speaker 4: In the past twelve months, it's raised over one hundred 150 00:09:33,760 --> 00:09:38,160 Speaker 4: million US dollars from investors across the world. Its profit 151 00:09:38,480 --> 00:09:41,880 Speaker 4: had jumped thirty six percent in the last calendar year, 152 00:09:42,320 --> 00:09:47,440 Speaker 4: with predictions of expanding into another ten countries in the 153 00:09:47,480 --> 00:09:53,199 Speaker 4: next eighteen months. The reputational damage to this company is significant. 154 00:09:53,760 --> 00:09:57,480 Speaker 4: They operate on the basis of providing services to cities 155 00:09:57,520 --> 00:10:00,800 Speaker 4: and paying fees. And at the moment we've got a 156 00:10:00,880 --> 00:10:05,320 Speaker 4: series of investigations both by counsels and least one police 157 00:10:05,360 --> 00:10:10,920 Speaker 4: service possibly more, which are looking into them misleading regulators 158 00:10:10,920 --> 00:10:14,959 Speaker 4: and the city councils they work for. So the significance 159 00:10:15,000 --> 00:10:18,160 Speaker 4: and the potential for this company in terms of its 160 00:10:18,240 --> 00:10:19,839 Speaker 4: damage is huge. 161 00:10:21,760 --> 00:10:22,280 Speaker 1: Coming up. 162 00:10:22,480 --> 00:10:26,880 Speaker 2: This isn't Alan Jong's first brush with investigators. Subscribers to 163 00:10:26,920 --> 00:10:29,360 Speaker 2: The Australian get first access to these kind of in 164 00:10:29,440 --> 00:10:33,480 Speaker 2: depth investigations. Plus there's breaking news alerts, newsletters and lively 165 00:10:33,520 --> 00:10:36,280 Speaker 2: commentary twenty four to seven. Check us out at the 166 00:10:36,280 --> 00:10:38,920 Speaker 2: Australian dot com dot au and we'll be back after 167 00:10:38,960 --> 00:10:52,200 Speaker 2: this break. B Mobility isn't Alan Jung's first tech venture, 168 00:10:52,600 --> 00:10:56,360 Speaker 2: and now is this his first encounter with government investigators. 169 00:10:56,720 --> 00:10:57,840 Speaker 2: Here's Michael McKenna. 170 00:10:58,559 --> 00:10:59,080 Speaker 3: That's right. 171 00:10:59,120 --> 00:11:01,800 Speaker 4: Alan Jang, one of the two co founders and Yale 172 00:11:01,920 --> 00:11:07,160 Speaker 4: University graduates, was previously a senior manager with Uber, initially 173 00:11:07,160 --> 00:11:10,560 Speaker 4: in twenty fourteen. He helped lead the expansion of Uber 174 00:11:10,600 --> 00:11:14,280 Speaker 4: into China and Malaysia before taking the reins as the 175 00:11:14,440 --> 00:11:19,520 Speaker 4: country manager for Indonesia in twenty seventeen. It emerged that 176 00:11:19,760 --> 00:11:23,319 Speaker 4: Uber was under investigation by the US Department of Justice 177 00:11:23,520 --> 00:11:28,880 Speaker 4: for alleged bribery. That US Department of Justice investigation was 178 00:11:28,960 --> 00:11:34,640 Speaker 4: into alleged payments by Uber employees alleged bribery payments to 179 00:11:34,840 --> 00:11:41,240 Speaker 4: Indonesian police officers. At the time, mister Jiang reportedly was 180 00:11:41,280 --> 00:11:45,960 Speaker 4: suspended and then left the company. The Department of Justice 181 00:11:45,960 --> 00:11:49,200 Speaker 4: investigation was discontinued in twenty twenty. 182 00:11:49,679 --> 00:11:51,199 Speaker 3: Mister Jiang says. 183 00:11:51,000 --> 00:11:54,360 Speaker 4: That he was not the focus of the investigation and 184 00:11:54,440 --> 00:11:58,440 Speaker 4: has provided a letter from his lawyers that says that 185 00:11:58,520 --> 00:12:01,480 Speaker 4: the Department of Justice a request to speak with him 186 00:12:01,600 --> 00:12:04,880 Speaker 4: or obtain any information from him. But there's no doubt 187 00:12:04,920 --> 00:12:09,319 Speaker 4: that when he left in twenty seventeen, Uber, the company 188 00:12:09,360 --> 00:12:12,520 Speaker 4: he led in Indonesia, was under investigation by the US 189 00:12:12,559 --> 00:12:17,240 Speaker 4: Department of Justice for foreign bribery allegations. 190 00:12:19,320 --> 00:12:25,640 Speaker 2: Michael McKenna is the Australian's Queensland Bureau Chief. He collaborated 191 00:12:25,640 --> 00:12:29,280 Speaker 2: on this investigation with senior reporter Sarah Elks. You can 192 00:12:29,320 --> 00:12:32,120 Speaker 2: read their full investigation as well as the latest updates 193 00:12:32,200 --> 00:12:34,600 Speaker 2: right now at the Australian dot Com dot Au