Territorians will head to the polls in August with no idea what the independent body that investigates corruption and other misconduct by politicians will look like under the next government, following scandal in the Office of the ICAC that has led to the anti-corruption commissioner currently under investigation for alleged “inappropriate behaviour” towards female staff and the acting commissioner refusing to explain a conflict of interest in relation to its largest investigation in three years.

The dysfunction in the office has already led to one report into the misuse of taxpayer funds by Labor staffers missing a deadline, while both major parties have failed to outline what they will do to fix the problems in the office if elected in August.

Meanwhile, a national integrity body has warned the OICAC’s failures and dysfunction could “damage good government” in the Territory if it remains unaddressed.

“It is pretty plain that if an integrity agency is not operating with full effect it can damage good government, not improve it,” said Geoffrey Watson, the director of the Centre for Public Integrity.

“As an outsider to the Territory, I will say something that may not be popular – in a relatively small town, where the big players all know each other, you should be looking for an outsider.”

Opposition CLP Leader Lia Finocchiaro refused to comment on the OICAC’s current situation, only to say that if the CLP is elected, it will maintain the status quo and provide more taxpayer funds to the office.

“While I maintain my long-standing practice of not commenting on the operations of the ICAC, the CLP will ensure the ICAC has the proper resources and personnel to do its job,” she said in an emailed statement.

Follow-up questions seeking comment on whether the office needs to be restructured, rather than have more money thrown at it, were not responded to.

Chief Minister Eva Lawler, who was supposed to receive the second report of Operation Jupiter – which probed the misuse of public funds by former chief minister Michael Gunner’s office in the lead up to the 2020 election – by Sunday, confirmed on Monday that the report had not been provided, but made no firm commitment to restructuring the agency.

Ms Lawler said the “next steps” for fixing the Office of the ICAC could not be considered until the investigation into Mr Riches is complete, “in around three months”.

“I have taken immediate actions to ensure the ICAC continues to play its important role in improving transparency and uncovering corruption and misconduct,” she said in an emailed statement.

“I have referred allegations of improper conduct towards staff within the Office of the ICAC to the Office of the Commissioner for Public Employment. Next steps can be considered after that investigation is complete in around three months.

“If I am the Chief Minister come the end of August, I will take the necessary steps to bring back stability to the Office and the ICAC and ensure its independence and solidify its important role in our democracy.”

Michael Riches has been placed on extended leave until September 22 – after the August 24 election – while the Office of the Public Employment Commissioner investigates allegations by “several” female staff members of inappropriate behaviour on his part. The allegations came to light while Mr Riches was being investigated by ICAC Inspector Bruce McClintock over his handling of domestic violence allegations levelled at him by his now ex-wife.

Mr McClintock cleared Mr Riches of “corrupt conduct”, including in relation to a $20,000 pay-off he made to his wife to drop a domestic violence order application made in May 2023, but made no reference to the undisclosed domestic violence undertaking he signed the same month and made no findings as to the truth of the domestic violence allegations.

Mr Riches said last month he was unaware of the allegations made by staff, stating that he had “always acted with the utmost professionalism toward all of my staff, and any suggestion to the contrary is outrageous”.

Mr Riches had pledged to deliver the second report into Operation Jupiter by June 30 – specifically into the misuse of taxpayer money and resources by Labor staffers on the fifth floor – after making no findings in his initial report despite evidence Mr Gunner and his staff used taxpayer money to fly to remote communities in marginal electorates on polling days during the 2020 election campaign outside of caretaker rules established to prevent the misuse of taxpayer money.

However, acting commissioner Naomi Loudon told Estimates hearings last month that she had no knowledge of the report due to a conflict of interest she declared internally. She has repeatedly refused to publicly disclose the nature of that conflict, despite the Centre for Public Integrity calling on her to reveal it publicly in the best interests of transparency and the public’s confidence in the institution.

The NT Independent also revealed Ms Loudon’s close friendship with Labor staffers, some of whom are connected to those involved in the rorting of public funds.

Both Ms Finocchiaro and Ms Lawler did not respond to a specific question about whether an outsider is needed to run the OICAC, as suggested by the Centre for Public Integrity, and if so, whether that would be done in partnership with another state’s anti-corruption body or with federal involvement; or if the mess should be given to the parliamentary committee on the ICAC to assess what options could be explored.

NT ICAC a troubled body since its inception

The NT’s first Independent Commissioner Against Ken Fleming drew criticism in 2019 when he made comments about corruption involving the shooting death of Kumanjayi Walker at a Black Lives Matter protest, which led to him recusing himself from being involved in the investigation into Zach Rolfe.

He was also forced to retract a report into a City of Darwin employee, it found had engaged in corrupt conduct after the staffer’s response to the allegations were not collected properly and ended up in a junk email folder. Mr Fleming also copped flack for secretly recording a Darwin Turf Club member during an investigation, with the recording appearing to be broadcast back to the office, in possible contravention of the law.

Mr Riches failed to provide Territorians with any fresh confidence after taking over in July 2021. He has a poor record when it comes to establishing corruption or misconduct against politicians or in the public service.

In three years, he has not made any significant conclusive findings on corruption or misconduct and has overseen a massive drop in KPIs in the office more generally. His annual report last year proclaimed that he was pleased to see that there was no “widespread corruption” in the Territory, but then proceeded to show the widespread corruption that exists and the poor processes and policies that lead to it.

He dropped an undisclosed number of investigations upon commencing the role and later ruled that a $10 million public funding scandal involving water bottling company Akuna Springs was outside of his jurisdiction to investigate.

Mr Riches also controversially removed the Darwin Turf Club grandstand report from the ICAC’s website, despite the Supreme Court ruling that the OICAC has every right to publish a public report naming people who engage in corruption.

He did however report on an unnamed public servant who lied about her resume to secure high-paying jobs in the public service that was first discovered as part of an investigation into corruption at the Batchelor Institute, with the findings of the Batchelor investigation later scrapped and replaced with a “review” that he said was not meant to “punish or embarrass” anyone at the institute.

Mr Riches also cleared everyone he investigated for alleged corruption in the three years he was in the role, including former chief minister Michael Gunner twice – once for alleged political interference in the charging of Zach Rolfe and again for the election travel rorts scandal. He also later said it was “not in the public interest” to pursue an investigation into allegations Police Commissioner Michael Murphy racially abused staff at a Chinese restaurant and was in the process of investigating racist awards handed out by the TRG before being suspended pending the latest investigation into his alleged conduct in the office.

There is no update on where the OICAC’s racist TRG awards investigation stands currently.