Millions paid to directors New details of Westpacs Forum fraud emerge

Westpac has accused colourful soccer identity Bill Papas’ Forum Finance of forging signatures of staff at French giant Veolia’s New Zealand offices on faked contracts that extracted an additional $44 million from the bank.

The bank has also stepped up its claim for Mr Papas’ overseas assets, expanding its claims for damages to the Greek company that holds much of Mr Papas’ identified overseas assets, Mazcon, alleging it received as much as $16 million as part of the allegedly fraudulent scheme.

Bill Papas and the Sydney company he founded, Forum Finance, have been accused of facilitating a fraud worth at least $400 million, by illegally obtaining loans from Westpac, Societe General and Sumitomo Mitsui Banking of Japan.

The documents also shine a light on the large sums of money received by Mr Papas’ Australian business partner, Vince Tesoriero, alleging he received $28 million in cash -- payment which exclude the massive property portfolio he accrued with Mr Papas during the allegedly fraudulent scheme.

Westpac this week expanded its claim against Mr Papas to include a separate legal action it had been taking in New Zealand against Forum’s NZ entities and Mr Papas.

Westpac has further added 21 new companies owned by Mr Papas and Mr Tesoriero. Eighteen of these companies were already subject to freezing orders and own a portfolio of luxury property and petrol stations in regional Victoria.

Westpac’s 544-page court filing details its allegations against the business partners.

“The total amount that Westpac and WNZL have identified as being fraudulently obtained by Mr Papas directly or indirectly through his involvement in the scheme is at least $40.225 million, which excludes funds fraudulently obtained and used to acquire other property such as boats and cars,” the document says.

In July, The Age and The Sydney Morning Herald revealed that Mr Papas and Mr Tesoriero had purchased property worth $60 million allegedly using money defrauded from Westpac. This masthead also revealed Mr Papas’ overseas assets including two seaside apartments in Thessaloniki said to be worth $10 million and a vast number of cars including two racing Audis.

Westpac alleges Mr Tesoriero received $2.3 million from Forum directly into his bank account, including instances where Forum made multiple transfers on a single day.

“The total amount that Westpac and Westpac New Zealand have currently identified as being fraudulently obtained by Mr Tesoriero through his involvement in the scheme is $28.478 million, which excludes funds fraudulently obtained and used to acquire other property such as boats and cars,” the lender claims.

Mr Tesoriero, a café owner in Melbourne, is subject to global freezing orders. He has been cooperating with liquidators and recently told the Federal Court the money he received from Forum and Mr Papas was in return for his initial seed investment in Forum of $10 million.

Mr Papas is yet to formally file a defence. He recently told the Federal Court that since being accused of fraud by Westpac he has suffered from coronavirus and mental health issues.

The bank has also added Mr Papas’ business partner in Greece, Anastasios Giamouridis, as a new respondent in its case against the soccer identity and his company for allegedly holding $10.7 million on trust for the bank and is seeking an order that he account for those funds, though it does not accuse him of any wrongdoing and does not press any claim for compensation or damages against Mr Giamouridis. Mr Giamouridis owns a 1 per cent stake in Mr Papas’ Greek company Mazcon.

Westpac’s total claim against Mr Papas for his alleged fraud now sits at $296 million, which includes $254 million from Westpac’s Australian business and $NZ44 million from its Kiwi arm. Japan’s Sumitomo alleges it was defrauded by $100 million by Mr Papas and his company, while French bank Société Générale alleges it was defrauded by more than $8 million.

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Sarah Danckert is a business reporter who specialises in investigations and corporate wrongdoing. She is a two-time Walkley Award winner, and has won five Quill Awards and two Kennedy Awards.

Charlotte Grieve is a reporter for The Age.

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