The Seven West board, led by Kerry Stokes, has probed shock claims of cocaine and sex workers plaguing investigative program Spotlight, with questions raised over the extent of knowledge in the finance department and among Seven executives.
News.com.au understands that news and current affairs boss Craig McPherson told the executives he was left in the dark over Spotlight producer Taylor Auerbach’s alleged socialising with Bruce Lehrmann involving brothels and prostitutes.
Mr McPherson was not grilled in person at today’s board meeting, but Channel 7 sources familiar with the discussions say that the board wanted more information from executives and the finance department about what had occurred.
The news and current affairs boss confirmed he knew nothing about a subsequent $750 invoice for “pre-production expenses” for Mr Lehrmann.
But the board wanted to know more from the finance department about why and how it was paid.
“How the hell were things like $750 to Lehrmann paid without supporting documents? Pretty full on,’’ a Seven source said.
Seven executives claim Mr McPherson and former Spotlight producer Mark Llewelleyn have been “blaming each other” over the Spotlight EP’s decision not to sack Mr Auerbach on the spot after he spent $10,000 on a credit card.
Mr McPherson is the partner of TV star Sonia Kruger. He has been contacted for comment.
News.com.au has confirmed that board members learned of the sex and drugs scandal from media reports and that questions were asked about the extent of knowledge among executives and the finance department.
Mr Llewellyn has now left the program in the wake of the fallout and his chief of staff, Steve Jackson, has left too, after being briefly mooted for a $300,000 job running police media.
As Justice Michael Lee began delivering his judgment in the Lehrmann defamation case this week, Seven issued a press release saying “Mark Llewellyn no longer works for the Seven Network”.
Both Mr Llewellyn and Mr Jackson had no knowledge of Mr Auerbach’s decision to book $10,000 in Thai massages before the event, but were aware of attempts to reverse the credit card charges after Mr Auerbach confessed to what had happened.
Mr Llewellyn decided to give Mr Auerbach another chance and did not accept his resignation.
“People who know me and people who work with me know that I have always insisted and always say that we must fight hard but we must never lie or deceive,” Mr Llewellyn told news.com.au last week.
“We have to fight harder than other shows because we don’t have their big, bloated budgets. Ratings are obviously important in a commercial world but NOT at the expense of getting (and telling) stories honestly and treating the people we interview the same way. And my team knows my firm views.”
There are just seven people on Seven’s board – Mr Stokes, who has the controlling stake in the company, his son Ryan Stokes, outgoing chief executive officer James Warburton, lawyer Michael Ziegelaar, iiNET founder Michael Malone, business executive Colette Garnsey and company director Teresa Dyson.
Seven confirmed the previously flagged departure of Mr Warburton on Thursday – who announced in December that he would go in June, but brought his departure forward recently to allow a new CEO to take up the reins.
The board spent the day dealing with the Spotlight fallout.
Mr Warburton flagged earlier this month that he was bringing forward his departure, and it was not related to the Spotlight drama.
“Current managing director and chief executive officer James Warburton will finish at SWM today … with Jeff Howard commencing in the role on April 19,” the company announced to the ASX on Thursday.
Mr Howard, the company’s chief financial officer, was announced as Mr Warburton’s successor in December and had been due to take up the role on June 30.
SWM chairman Kerry Stokes and Mr Howard both thanked Mr Warburton for his contribution to the business over many years.
This week, Mr Auerbach dropped a new bomb on Channel 7, sending a concerns notice regarding comments purportedly made by a number of the network’s executives.
The concerns notice names Mr Warburton, Kerry Stokes’ longstanding right-hand man Bruce McWilliam, and producer and blogger Robert McKnight, and refers to comments it is claimed they made over the cocaine and sex scandal that emerged around the program’s explosive interview with Mr Lehrmann.
Seven insiders have told news.com.au that Mr Auerbach’s first concerns notice alleged he had been defamed by statements Seven published to the ABC’s Media Watch program on or around March 25, 2024.
Law firm Giles George’s defamation specialist, Rebekah Giles, sent a second concerns notice this week.
It raises concerns about comments reportedly made by outgoing CEO Mr Warburton in an email to all Seven staff. It also concerns comments made by Mr McWilliam outside the Federal Court to Sky News’ Caroline Marcus and comments made by Spotlight producer Mr McKnight on his podcast.
Mr Warburton sent out a note to staff on April 4 saying the claims that had emerged were not part of the broadcaster’s culture.
“Seven is appalled by the allegations made in court in recent days. We do not condone the behaviours described in these allegations. They do not reflect the culture of Seven,’’ he said.
“For the record, Seven did not offer a promotion or pay rise to Taylor Auerbach in November 2022, nor did it do so at any time after that.
“Seven did not reimburse Bruce Lehrmann for expenditures that have allegedly been used to pay for illegal drugs or prostitutes, and has never done so.
“We also take issue with the allegations recently made about our conduct.”