Court finds Bill Papas ‘the architect’ of $500 million bank fraud

Former businessmen Bill Papas and Vincenzo Tesoriero orchestrated an “audacious” fraudulent scheme involving fake lease-loan agreements, defrauding three banks of more than $500 million, according to a Federal Court ruling.

According to The Australian, the decision paves the way for potential recovery actions and possible criminal charges.

On Friday, Justice Elizabeth Cheeseman ruled that Papas was the main architect behind the fraud, with his partner, Louise Agostino, also involved. The court further found that Papas’ business associate, Vincenzo Tesoriero, and former financial controller Tony Bouchahine were aware of the fraudulent activities.

Companies controlled by the men had no “legitimate” purpose other than to execute the fraud and disperse “tainted” funds, the court determined.

Papas, also known as Basille Papadimitriou, has been embroiled in legal battles alongside Tesoriero for three years, with Westpac pursuing the men and their alleged co-conspirators through at least 138 court hearings and actions before three judges.

The case initially arose when WesTrac, a West Australian mining operator, questioned nearly $12 million in loans recorded in Westpac’s books. The loans were tied to equipment leases from Forum, a Sydney-based company, though WesTrac had only financed a single printer-photocopier worth $1.6 million, which had been paid off in early 2021.

Westpac’s internal investigation revealed fraudulent invoices worth over $290 million involving major clients, including Coles, Woolworths, and waste management giant Veolia.

Shortly after suspicions arose, Papas fled Australia in breach of the country’s strict Covid-19 border controls. He initially stayed in a luxury hotel in Athens before moving to Thessaloniki, where he owned several properties and businesses.

Despite assurances to the court that he would return to face the accusations, Papas refused to come back to Australia. A Federal Court judge, Michael Lee, eventually issued an arrest warrant for him. Meanwhile, Tesoriero has remained in Australia after having his passport seized.

Investigations by liquidators McGrathNicol revealed that close to $500 million had been siphoned from Westpac, as well as from Japanese lender Sumitomo Mitsui Banking Corporation and French bank Societe Generale. Forum Finance had created false lease-loan schemes and even sold the future earnings of these fake contracts, without ever missing a payment.

Source: The Australian