Alleged Forum Finance fraud, and ex Sydney Olympic president, Bill Papas withdrew his football club Xanthi from the Greek sporting league, after financial and cash flow issues left it unable to compete.

In a statement to the fans, signed off by Mr Papas, and the Xanthi FC board – which includes his partner and alleged party to the bank fraud Louise Agostino – organisers confirmed the team would withdraw from the Greek Super League 2 competition.

Xanthi FC issued a statement saying the team was pulled from the draw due to financial troubles. It also said that Mr Papas was unable to sell the team or find “alternative financing solutions” in over nine months.

“After two years of great financial contribution to the team and to the city, we have not been able to find a solution in time to continue our plans,” Xanthi said.

“The owner (of Xanthi) undertakes to personally communicate with each employee to undertake the payment of their financial

claims in the best possible way,” a statement read from the club.

The withdrawal comes despite Mr Papas’ efforts to secure monetary backing for his team from local government.

Meanwhile in Australia, Westpac and two other banks are independently pursuing Mr Papas in the Federal Court for about $400 million over claims he used Forum Finance to issue false and fraudulent equipment finance invoices. Those invoices were allegedly issued for equipment that often didn’t exist.

A Federal Court hearing is aimed for February 2023 after delays and the appointment of a new presiding judge. Mr Papas left Australia for Greece when questions about customer invoices were raised in 2021. He has since been joined there by Ms Agostino.

Mr Papas failed to submit a detailed reply to Westpac’s claims and despite indicating earlier that he would return to Australia; he remains in Greece.

Mr Papas’ only legal intervention, since dumping his legal representation, was to hire defamation lawyer Rebekah Giles. She issued a statement to The Australian noting the businessman did intend to address the matters alleged by Westpac, however that Mr Papas had not had an opportunity to resource his case.

Ms Giles neither confirmed, nor denied whether she continued to represent Mr Papas when contacted by the national masthead (The Australian).

His bank accounts and assets – including his shares in Xanthi – have been frozen by the courts. However, he was granted funds by the Federal Court to pay for his defence.

Ms Agostino did not respond to Westpac’s allegations, but her lawyers indicated in March she would return to Australia to fight the claims. It was reported that Ms Agostino has since dumped her lawyers and remains in Greece.

Mr Papas in recent days met Xanthi Abdera municipality mayor Tsitiridis Giorios “to find a solution” for the football club.

Greek media reported Mr Papas has been struggling to keep the lights on at his football stadium. The club’s problems also prompted a string of exits from Xanthi FC, with some players traded or let go.

In February Mr Papas had been blocked by Greek football authorities from looking to raise €4.72 million ($7.52 million) through the issuance of new shares in Xanthi FC, diluting his stake in the club.

Mr Papas purchased Xanthi FC in 2020 for $15 million, allegedly using money garnered from the claimed Westpac fraud.

The Federal Court heard claims that he funnelled at least €1.9 million ($AUD 2.96 million) to the Xanthi FC through sham business investments, and from funds allegedly defrauded from the banks.

Westpac continues to attempt to claw back funds from entities linked to Mr Papas, including having served a pleading on Greek tea promoting company Theion Ike, in accordance with Hague conventions.

Earlier documents in the case against Mr Papas showed Theion Ike was extended a €420,000 ($AUD 625,428 million) loan to obtain shares in a company in Greece.

Westpac alleges Theion Ike received at least $AUD655,000 from Forum Group Financial Services, or 286 Carlisle Street – the latter being a company whose directors are Mr Papas’ business associate Vincenzo Tesoriero and his father.

The bank claims that at least some of this money was paid for the benefit of Mr Papas and that Theion Ike is accountable to repay funds to Westpac, or provide compensation.

Other documents lodged with the court divulge the large amount of cash burned by Mr Tesoriero, who is defending allegations by Westpac that he is linked to the fraudulent activity.

The court filings show Mr Tesoriero has just $70,663.72 of funds remaining, of the $1.25 million allowed for him to access for legal expenses. His bank accounts and assets have also been frozen while the court action continues.

Earlier this month in court Mr Tesoriero’s new barrister signalled that his client was expected to apply for more funds to be made available to pay for his case.

“The parties’ solicitors are currently corresponding regarding this issue, in an attempt to avoid the need for a further application,” the documents said.

“However, in the event that the issue cannot be resolved by consent, the Tesoriero respondents intend to apply for a further variation of the freezing orders.”

That matter is slated to be heard next month.