– Julia Gillard’s high-stakes election strategy was rocked when ex-Labor MP Craig Thomson was arrested on 149 fraud charges – including allegedly using union funds to pay for prostitutes.

In a horrid start to the political year for the Prime Minister, police arrested the MP yesterday over the allegations he misappropriated hundreds of thousands of dollars of funds while he was Health Services Union secretary.

The charges follow an investigation by Victorian Fraud Squad detectives who are understood to have been told of at least one overseas witness in relation to claims Mr Thomson spent more than $7000 of union monies on escort services.

A shaken Mr Thomson emerged from the Wyong Court late yesterday after being granted bail, including one condition that he not contact directly or indirectly anyone he is alleged to have engaged for sexual services.

The one-time Labor rising star – who was dumped by the ALP over his union indiscretions – will travel to Melbourne next week for a court hearing and vowed to vigorously defend the multiple charges.

Victorian Fraud Squad detectives – who invited Mr Thomson to travel to Melbourne before Christmas – will allege Mr Thomson used HSU funds to pay for escorts and other personal items.

Police have worked closely with Fair Work Australia, which has also taken action against Mr Thomson, including over claims that he withdrew $102,337.47 in cash advances between 2002 and 2007.

The FWA court action – which is set down for a directions hearing in Melbourne this morning – may be deferred to allow the more serious criminal allegations to be heard by a court.

And in a further setback for Mr Thomson, NSW Police confirmed that he remained a person of interest in relation to Strikeforce Carnarvon. That investigation has already led to multiple charges being laid against former Labor powerbroker and union boss, Michael Williamson.

Labor MPs reacted with horror upon hearing of the charges laid against their former colleague, who received more than $300,000 in legal assistance from the NSW ALP as he fought the allegations of fraud.

The MP is alleged to have used two union credit cards to make cash withdrawals and for unauthorised transactions, including more than $7000 spent on prostitutes.

The Herald Sun understands police have engaged forensic experts to try to prove their case against the MP, whose credit card, driver’s licence and mobile phone has been linked to transactions involving escort services in Sydney and Melbourne.

The Prime Minister declined to comment on the arrest of her former colleague, telling reporters in the flooded city of Bundaberg that it was a matter for the police.

But Opposition Leader Tony Abbott said the Thomson scandal reflected badly on Ms Gillard’s political judgement.

During a brief appearance in Wyong Court, Mr Thomson was formally charged with one count of misuse of a credit card to the value of $330.

He did not enter a plea but was remanded to appear in the Melbourne Magistrates Court on February 6th.

He was given bail on three conditions, including that he notify police within 24 hours’ notice of any travel overseas or interstate, with the exception of travel to Canberra.

Mr Thomson nodded when he was asked if he understood the bail conditions.

Kathy Jackson, the HSU whistleblower who initially took the allegations to the police, applauded the move – Steve Lewis

About Jumpin' Jack Cash

Deep connections are the most important aspect of my existence. I don’t care if people don’t know what they want. I love books. I’m cynical of love stories, although I’m romantic. I adore gardens. I like women who challenge me. I love the rain as an excuse to stay inside and dream. I'm furiously impatient. If I ask you a question best to tell me the truth as I'm likely to already know the answer. I'm a carnivore. I continuously underestimate the magic of fresh flowers in my home. I love warm rain in the summer. My mood elevates to epic proportions when the sun shines. Tell me not to do something and I'll do it twice and take photos. Running is my antidepressant. I loathe lies. I rarely forgive a lie. Loyalty and honesty are my most noble virtues, and I value them more than anything in other people. I love to love, and am able to fall in love very quickly, although it's only ever happened once. I understood myself and fixed myself only after destroying myself. My greatest excitement comes from deliberately getting lost in foreign cities. I can be extremely loud and frighteningly silent. I hate insinuations. I love storms. Justice for all. I'm a proud man, but welcome the influence of the feminine soul. I have two sisters. I’m a dreamer. I’m a deep thinker. Don’t deal with guilt trips or drama that well. I'm extremely stubborn and persistent. I'm brilliant at keeping secrets. I love driving. I become absolutely and completely lost while watching a burning fire. When the toast pops from the toaster I’m never ready and shit myself. I play the guitar, but require much improvement. Solitude and warmth of the sun are perfect together. I’ve been married once and now divorced. I’m a music junkie. Chocolate mousse is the shit. I curse too much. I find it difficult to make friends. I spent four years as a firefighter. I’ve run my own company since 1991. Bright lights, big cities. I’ve been an executive producer of a feature film. Some people don’t care, and that’s the biggest let-down of the human race. There are cures and solutions for many evils, but no remedy for the worst of them all - the apathy of human beings. The sound of the Italian language being spoken is as good as my favourite music. I hate corrupt cops. I relentlessly and passionately pursue anybody and anything that sets my soul on fire. I'm a dog lover, and all my dogs are considered family members. I have an obsession with photography. I have some close friends who are household names, but shall always remain anonymous. I’m crazy but not lazy. Losing a soulmate has hurt me badly. My two young sons are the nucleus of my universe. I love airports. I love freedom. If you are dishonest or disloyal, I can erase you from my life and memory immediately and permanently. I yearn to explore, dream about and discover as many friendships, deep connections and places, one possibly can in a lifetime.
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