What was initially reported as a $297-million fraud allegedly perpetrated by Bill Papas through his company Forum Finance, is now reportedly blown to $500 million.
A joint media investigation led by newspapers The Age and Sydney Morning Herald , published on Sunday (6 February) morning and Channel 9 current-affairs programme 60 Minutes, which aired yesterday evening focussed extensively on the case.
After he was contacted by the media outlets Mr Papas issued a rare statement saying: “The reporting and opinions publicly advanced about Forum and other entities have been formulated without the benefit of a contradictor. This is because I have been deprived of the opportunity to fund any meaningful engagement with Federal proceedings commenced by a well-resourced financial institution. I do intend to address the matters raised at an appropriate time but for now, my primary focus is my health.”
The media investigations allege that Mr Papas has been living a luxurious lifestyle in Greece, where he fled in June last year, six days after Westpac contacted him about contract anomalies that had been picked up by the finance manager of client company WesTrac in June, last year.
Papas allegedly told WesTrac that there had been a misunderstanding and that he was on his way to Perth to explain the anomalies to the company on 15 June. Instead he boarded a flight to Greece where he has since remained.
Last July, civil proceedings were launched against Mr Papas in the Federal Court by Westpac, as well as Sumitomo Mitsui Banking Corporation of Japan and Société Generale of France.
The anomalies that the WesTrac finance manager had noted were a series of loans made in the heavy- equipment contractor’s name and which were signed by the company CEO. However, the signature was not the CEO’s nor had he seen the documents which featured the faked signature. The numbers also did not add up for the company.
As Westpac realised there was a problem, so the scale of it began to grow with other bank clients reporting similar problems of loan documents not seen by them and fraudulently signed in their name. Clients included established corporations like Coles, Australian Liquor and Hospitality Group, Scentre the owner of Westfield shopping malls as well as small businesses, such as Quantum Solutions who turned to Forum in 2016 to develop a software program to streamline the trucking business. The company CEO, Deb Roberts lost $180,000 and the company’s credit standing has been damaged by the experience.
Papas allegedly delayed detection by ensuring that Forum Finance made all the “loan” payments on time, so that neither the client, nor the bank had reason to question the “loan”.
The media investigation alleged that hundreds of signatures were forged with Mr Papas doing the forging. Jason Ireland of McGrathNicol Liquidators (who are looking to recover the missing millions), said that what started as loans worth hundreds of thousands of dollars grew progressively to millions of dollars per loan contract.
He said liquidator investigators had looked at five million pieces of evidence, including emails and messaging applications. Their investigation examined 150 bank accounts and 110,000 transactions and Mr Ireland said it became very clear where the money had gone.
He alleged that a large proportion, in the hundreds of millions, of the defrauded funds went to pay the operating costs of Forum Finance (created by Mr Papas in 2011) which included a business-machine leasing empire and Iugis, a food waste-management system used in the hospitality industry.
The liquidator estimated that $50 million allegedly went into buying properties. Millions also went to pay for a lavish lifestyle that included expensive cars, yachts, jet skis and the trailers to transport them.
He said there was a real chance that there was a shortfall of hundreds of millions of dollars yet to be recovered and that this amount may not even be in Australia.
Mr Ireland said Mr Papas dreamt of being a “big-shot businessman” and he was to promote Iugis through a sponsorship deal with English Premier League club Liverpool FC with the aim of giving the company international recognition.
Without the fraudulent loans, Mr Ireland said the business was completely insolvent -when the alleged fraud was uncovered, the business collapsed.
The investigations were showing that tens of millions of the money allegedly went to a number of entities in Greece.
In 2020, Mr Papas paid $15 million for ownership of Xanthi FC. At the time, he appointed Tony Popovic as its coach and said the club would be a launching pad for Socceroos in Europe. He resigned as president of Sydney Olympic soon after the allegations against him surfaced.
Australian Federal Court Justice Michael Lee froze Mr Papas’ assets in Australia. McGrathNicol sold a home in Rozelle owned by Mr Papas and business partner Vince Tesoriero and are selling his $12million-plus waterfront home on the Central Coast to recoup some of the funds.
While Mr Papas has claimed in affidavits to the Federal court that he does have money to pay for a ticket to Australia, Sunday’s media reports alleged that Mr Papas lived in a luxurious apartment he owned in Thessaloniki and travelled often to Athens where he stayed in expensive hotels and was regularly seen shopping in high-end shops in exclusive parts of the Greek capital.
Sydney Morning Herald business reporter Sarah Danckert said that while there was an extradition treaty with Greece, Mr Papas was accused of fraud by an Australian bank on a civil matter and not by police on a criminal matter which would make his extradition more certain. The fact that the Federal Court had issued an arrest warrant on a contempt-of-court charge meant that Mr Papas could defend that charge from Greece.
She said, however, that New South Wales Police Force was investigating Mr Papas for fraud but that it could not comment on the progress of its investigation.
