John Williams (NSW, National Party) Share this | Link to this | Hansard source

I rise today to talk on a most important issue that faces our nation, and that is the issue of people being ripped off by people laundering money, taking people's life savings and leaving them homeless and in dire financial straits. I refer to a story in the Age by journalist Adele Ferguson, a courageous journalist who, in my opinion, always speaks the facts. In her story, Ms Ferguson says:

In the summer of 2006, when swimming pool cleaner John Nicoll realised he had lost his life's savings in a get-rich investment scheme gone wrong, thoughts of revenge consumed him.

…   …   …

"I trusted him," Nicoll says of business man Ian Lazar. He blames Lazar for stripping him of his life choices. … Nicoll and dozens of investors had placed their trust in Lazar and his seemingly well-credentialled companies.

…   …   …

BACF—

the BA group of companies—

engaged in managed investment schemes but quickly went on to cost self-funded retirees in Australia at least $15 million, with many losing their homes, their retirement savings and their marriages.

…   …   …

The BA companies were put into liquidation in 2005 after complaints from investors and ASIC's investigation found BACF was operating an unregistered managed investment scheme.

…   …   …

The Nauru government eventually paid out more than $8.5 million, but investors saw none of it.

Documents filed with ASIC and to creditors reveal that the liquidator, Andrew Wily of Armstrong Wily, took an estimated $1.6 million in fees between 2005 and September 2008, law firm Nikolaidis & Company was paid $2.1 million at September 29, 2007, a litigation funder that was set up in a tax haven in Vanuatu with no visible directors was paid $3.1 million in commission, and $1 million was paid to a Lazar-related company, HLBC.

Mr Wily was appointed liquidator in 2005. Wily appointed notorious debt collector and former financial adviser to Alan Bond, Jim Byrnes. Some of you may have heard of Jim Byrnes.

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

Yes, I have, Senator Williams.

John Williams (NSW, National Party) Share this | Link to this | Hansard source

It says in this story, Senator Fierravanti-Wells:

BIG Jim Byrnes (right) has been bankrupt, served time in prison for the deemed supply of heroin, been banned by ASIC from running companies and had a judge accuse him of having a notorious reputation as a standover man and associate of major criminals.

Mr Wily also appointed Sydney lawyer Leon Nikolaidis while Nikolaidis was on bail over allegations of criminal fraud. This article, from the Melbourne Age of Saturday, 11 September, also says:

BANNED lawyer Leon Nikolaidis, who was sentenced to jail in 2007 for falsifying documents, was the solicitor of choice in many of liquidator Andrew Wily's cases.

I quote another of Adele Ferguson's stories:

Luring risk-averse investors, with the promise that their investments would be fully secured by mortgages and with plenty of equity, the BA group—

Ian Lazar's group—

failed to provide such security.

Of the investors who were interviewed by BusinessDay, none received the promised securities.

This is another glaring example of how the Australian Investments and Securities Commission—the regulator—can't be relied upon to protect investors, despite numerous complaints.

I instigated an inquiry into the liquidating industry and insolvency practitioners two years ago, and the report of that inquiry, from all sides of the parliament, was scathing about ASIC for not doing their job properly. They are the corporate watchdog. It is up to them to see that corporations play by the rules, do the right thing and see that financial products out there in the marketplace are not simply cars without brakes, in which people go down hills, crash into trees and destroy themselves. That is the problem I have with ASIC. I will continue:

For many years, victims of crime have been protected by a charter of victims' rights enshrined in legislation—

this is from Adele Ferguson's story—

so that they are to be informed of the progress of their complaints, likely outcomes and reasons for decisions not to prosecute by police. In the case of ASIC, its policy is not to discuss progress of complaints, not to inform victims of decisions, and not to inform victims whether or not their complaints will be, or are being, acted upon. This policy allows them to hide many deficiencies and leaves victims in limbo.

I have a summary here from David Nicholson in a statutory declaration, sworn on a Bible, of course. David and his wife invested $100,000 with Ian Lazar, who was promoting risk-free investments secured by real property. Steven Brown of Etienne Lawyers arranged with his client Ian Lazar to take David's money as payment for fees owed in other matters. Mr Nicholson volunteered to go on the committee of inspection in the subsequent liquidation of Lazar's companies. The liquidator appointed by Lazar, firstly, and then later by ASIC was Andrew Wily of armstrongWily in Sydney. Wily enlisted Jim Byrnes to recover debts owed to the companies. Wily appointed Leon Nikolaidis as a solicitor. At the time Wily appointed him, Nikolaidis was awaiting trial for fraud and was subsequently convicted, jailed and struck off as a solicitor.

Mr Nicholson made several complaints about Wily's conduct to ASIC, with no response. No surprise. Wily appointed a litigation fund that appears not to exist and agreed to pay it $3.3 million for doing nothing, as it turned out. Wily consumed around $9 million in his own fees and moneys paid to others. Ordinary creditors and investors got nothing.

It gets worse. I also have a sworn statutory declaration from Kevin Jacobsen OAM, a well-known Australian through the entertainment industry, brother of Col Joye. Kevin Jacobsen was awarded the Order of Australia medal in 1985. He is 77 years old and has been one of the world's top theatrical producers for nearly 40 years. His name will be well known to many Australians. Mr Jacobsen operated the Sydney Entertainment Centre for 26 years and brought many famous entertainers to Australia. Mr Jacobsen had a successful business but needed some assistance with a company dispute over the lease at the entertainment centre. Ian Lazar, whose birth name was Ian Rogut, was introduced by Achilles 'Al' Constantinidis as a trusted business adviser and litigation funder. Al Constantinidis was a partner in the piggery of a former prime minister, Mr Paul Keating.

Since the time that Kevin Jacobsen first met Lazar, which was less than one year ago, he has lost all his businesses and had all his trading companies placed in liquidation. He has had his car stolen by Ian Lazar. Mr Jacobsen told me how he told Mr Lazar that he would like to sell his Lexus. Lazar said, 'Give it to me. I am a licensed dealer. I will get rid of it.' He has not seen the car since or any money. He said, 'It has just disappeared like flatulence in the wind.' This is what we are facing.

Mr Jacobsen had $84,000 fraudulently charged to his AMEX card by Mr Lazar. He has lost access to all the funds paid to the Sydney Harbour Foreshore Authority to cover the breaking of the lease. Mr Jacobsen has lost a $6.1 million sale of rights over a musical because Mr Lazar has placed a false charge over Kevin Jacobsen Pty Ltd, the company involved which is now in liquidation.

Constantinidis also introduced Andrew Wily of armstrongWily to Jacobsen. Within one hour of arriving to meet Jacobsen at the entertainment centre, Wily's staff had emptied all the cash out of the ATMs, and the cash appears not to have been seen again. Wily then charged $250,000 in fees for six days work. Mr Jacobsen has no knowledge of any work carried out by Wily. Staff of armstrongWily emptied the safe and all the ATMs at the entertainment centre and have never accounted for the cash. Jacobsen says, 'I believe it to be around $150,000 in cold cash.' Lazar then put in a claim for $1.2 million against the proceeds of the settlement when no moneys are owed to him.

It gets worse. I will take you to the Webb family. Adam Webb and his family ran a successful company which had been operating for 25 years. They engaged a business adviser for restructuring by the name of John Brickwood who took over running of the company in September 2003. Brickwood's first act was to order staff to stop all payments to the ATO—group tax, company tax and superannuation guarantee levies. This information is all from sworn documents that I have here. These are not my words. Brickwood set about destroying the business and selling off the assets which the Webbs had built over their working lives. In December 2003 Brickwood told the Webbs he had a company that would provide 18 per cent interest on investment. Adam Webb's mother, father and sister invested $600,000 of their superannuation funds in this company. All funds were lost.

In March 2005, the company manager provided Adam Webb with a statutory declaration about a conversation on a boat which was jointly owned by Brickwood and—guess who?—liquidator Andrew Wily. Brickwood discussed involving Wiley in liquidating a number of Webb's related companies and Wily agreed his fee would be around $300,000. Brickwood also disclosed he had a relationship with other staff of armstrongWily, such as Tim Gillespie.

In 2004 Brickwood engaged Leon Nikolaidis to act for the Webbs. The same name appears again—the very solicitor who went to jail for fraud. Brickwood did not advise the Webbs that Nikolaidis was awaiting trial for a criminal matter for which he was subsequently convicted, jailed and struck off as a solicitor. Brickwood told Adam and Tony Webb in 2005 that Wily would be a friendly liquidator and would do what Brickwood wanted. After sale of a factory owned by Tony Webb where the purchaser paid $335,000 in GST, Brickwood placed that money in an unrelated company—Legal Response Pty Ltd—which he controlled. It was supposed to be paid to the tax office as BAS payments and GST. It has never been paid.

When armstrongWily was administering or liquidating Vertex Trading Australia Pty Ltd, Adam Webb told Wily that Brickwood had stolen $1.5 million from Vertex Trading Pty Ltd and transferred it to his own company, Alternative Business Solutions Pty Ltd. David Hurst from armstrongWily said they could not take any action to get back the stolen money as they were not in charge of Vertex Trading Pty Ltd. Adam Webb prepared a chart of estimated losses through Brickwood's conduct to the ATO which shows around $3.5 million has been lost to the Australian Taxation Office. The Webbs lodged formal and written complaints to ASIC, the IPA and the Institute of Chartered Accountants about Wily. They received no assistance from any of these bodies, and that is no surprise to me. Time is against me to continue with other rotten deeds—about Mr Byrnes, who admitted to taking $600,000, losing it and saying he would pay it back. But now he just works for DoCS out at Wagga Wagga. I have a letter to table, where he agreed on taking the money, but ASIC says there will be no further investigations on him.

The word has got out that I was going to make this speech. A couple of days ago I got an email from Cambridge Law about me making this speech in the parliament. It states:

If, despite this notice, you elect to make reference to our client in parliament, then we confirm we have instructions to both make formal complaints to the office of the Prime Minister—

who cares—

ICAC—

doesn't cover us—

as well as to a variety of other entities and outlets so that your conduct can be investigated.

That is from Raed Rahal, Cambridge Law, who have offices in Sydney, Dubai, Damascus and Baghdad. Mr Raed Rahal, my message to you is: I do not give a rodent's backside what you think and I will say what I want in this place when it comes to highlighting white collar crime and the destruction of people's lives.

I could go on with many of these things but I will say this: I look forward to talking to the Federal Police this afternoon to give them this file of documents. It is time this country had a royal commission into white collar crime. I believe it is systematic, it is growing and innocent people are losing their livelihoods from crooks. I seek leave to table these affidavits and those Adele Ferguson documents and to incorporate them in Hansard.

Leave granted.

The documents are avai l able from the Senate Table Office.

Thank you, Mr Acting Deputy President. You will hear more about this in the future.