Three developers, nine companies, $44,000 for the Liberals: Inside a donation law loophole

Three wealthy property developers, including the son of a $400 million nut king, used a network of jointly owned companies to donate $44,100 to the Victorian Liberal Party in a single week, a move which did not breach the state’s donation laws because each payment came from a separate legal entity.

The cash windfall has exposed a potential loophole in Victoria’s political donation scheme that could allow other wealthy donors to funnel tens of thousands of dollars to political parties and independent candidates using a similar setup.

Between late April and early May, the Victorian branch of the Liberals received a total of $58,800 from a dozen businesses all named variations of Mensch Investments, Victorian Electoral Commission (VEC) records show.

Nine of the companies are named Mensch Investments Industrial, and are differentiated only by a single number from SL7-1 through to SL7-9. All nine have the same directors: businessmen David Scalzo, Anthony Caligiuri and Eli Goldfinger. Caligiuri and Scalzo are the shareholders of each of the companies, which are all registered at the address of Goldfinger’s St Kilda Road advisory business. Collectively, the nine businesses donated $44,100 in a single week.

The other three companies are named Mensch Investments Partnership, and numbered one through three. Corporate records identify them as SG Mensch Investments companies, with Scalzo listed as the sole director of each and all registered to the address of his South Melbourne office. Each of the three companies individually donated $4900.

Between April 30 and May 4, the combined total of the donations by the 12 companies gave a $58,800 cash boost to the Liberal Party.

At the time the donations were made, Victoria’s political donations were capped at $5190 from a single donor or organisation over a four-year parliamentary term.

The cap applies to entities that are “related”, meaning businesses that are connected by parent companies, subsidiaries or holding companies can collectively still only donate up to the cap.

But companies are not necessarily considered related simply because they share the same director or shareholders. Separately incorporated companies with common owners can instead be treated as separate donors if they don’t meet the definition of a related body corporate, under the Corporations Act, used by the VEC.

This provision creates a potential loophole that could be used by other political parties, including One Nation, which is mounting an ambitious campaign across Victoria ahead of the November state election and has been attracting significant financial backing nationally.

Mensch Investments insists that each company was legally entitled to make its own donation even though the bodies share the Mensch name.

Goldfinger is the director of EGA Corporate Advisers, a consultancy specialising in business financial and property advice. Last year, he purchased a $13.1 million Toorak mansion formerly owned by Tania Buckley, the ex-wife of former AFL star Nathan Buckley.

Scalzo’s father, Quinto Scalzo, made his name as a $400 million nut king through the success of his nut importing and distribution business, now called Scalzo Food Industries. He is listed as a former shareholder in the three Mensch Investments Partnership companies.

David Scalzo has served on the food company’s board while also managing the family’s property interests. He is also managing director and founder of Perri Projects, a privately owned real estate investment house which has amassed a portfolio of more than $3 billion.

Caligiuri is managing director of Califam Constructions, a sewer contractor which carries out work for a range of government owned water utilities. He has been involved in a number of significant greenfield developments in Melbourne.

All three developers are also directors at firm Mount Atkinson Holdings, which is working with ASX-listed company Stockland to build a $2 billion industrial precinct in Melbourne’s west. The project is billed as a major employment hub and residential community that will house more than 20,000 people over 1700 acres in Truganina, in Melbourne’s west.

The potential loophole is not confined to Victoria, with federal electoral laws using the same Corporations Act test to determine whether companies are related and must be treated as a single donor. New federal political donation caps of $50,000 a year, which will come into place from January 1, 2027, did not address the issue potentially opening the door to similar donation patterns through multiple separate businesses.

Catherine Williams from the Centre for Public Integrity said the definition of a related corporate entity in Victoria’s donation laws was very narrow.

She said the intent of the rules – put in place in June after the High Court ripped up Victoria’s campaign finance laws earlier this year – was to ensure individual entities could not enjoy political influence disproportionate to others. She said it was worth considering whether this narrow definition was appropriate and whether changes were required.

“This is one issue that we hope the expert panel that will be established after the election to consider comprehensively Victoria’s political finance regulation will pick up,” she said.

“One of the real problems with legislating at high speed, as happened earlier this year when the entire Part 12 of Victoria’s Electoral Act was invalidated and needed to be replaced, was that there wasn’t time to undertake the consultation that is required to flush out issues like this.

“That’s why the statutory review is such an important mechanism, and we look forward to that running immediately after the election.”

An expert review of the state’s electoral laws must be completed within 12 months of the election – a concession the government offered to win the support of Greens and crossbench MPs for the donations’ legislation.

That review will also consider whether there should be a limit on election spending – something already in place in NSW, Queensland and Western Australia, and which integrity experts have been calling for Victoria to adopt.

NSW, South Australia and the ACT all have bans on donations from property developers – a ban the Victorian Greens have called for here. Earlier this year, the Queensland government lifted its ban on developer donations.

The Age sought comment from Scalzo, Caligiuri and Goldfinger. A spokesperson for Mensch Investments said each of the separate company donations was legal.

“Each company has also acted with integrity. As you know, each donation was reported to the Victorian Electoral Commission in the manner prescribed by the VEC on its website, subjecting each donation to VEC vetting,” the spokesperson said.

“We assume the government has thoughtfully designed donation laws, especially after having the advantage of High Court scrutiny of donation laws earlier this year.”

Asked about the donations, a Liberal Party spokesperson said the party “operates in compliance with the Electoral Act”.

A VEC spokesperson said they did not comment on individual cases but closely monitored donation disclosures. The $5190 cap applies to donations made between April 15 and the election on November 28.

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