Business

Bill Lewski is back, but with a hazy memory when it comes to investor money

Misplacing $27 million? Anyone can do that...What about $50 million? 

Melbourne businessman Bill Lewski can't recall where $27 million of investors' money paid to him by way of a listing fee for the since-collapsed Prime Trust have ended up, a court has heard. 

The Prime Trust's founder's memory was also hazy when it came to the whereabouts of a further $50 million that was at one point held by family company Retirement Guide.

Mr Lewski made the admission during a public examination into the affairs of the responsible entity for Prime Trust, Australian Property Custodian Holdings at the Supreme Court of Victoria on Thursday.

He also revealed that he's back in the retirement village business, advising a company with properties in Townsville and Brisbane. 

Lapsed statute of limitations

Earlier this year, the Full Court of the Federal Court overturned a 15-year ban levelled against Mr Lewski for allegedly breaching the Corporations Act over the transfer of $33 million of investor money to him. Other Prime Trust directors including former Federal Health Minister Michael Wooldridge also had their bans overturned as a result of the appeal. 

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The original Federal Court ruling was overturned after the Full Court found the Australian Securities and Investments Commission brought the case after the statute of limitations had lapsed.

Retirement village owner Prime Trust, once worth $560 million, collapsed in 2010 wiping out the savings of about 8000 investors.

Mr Lewski is accused by liquidators and receivers to the company of allegedly siphoning off $93 million of investor money by way of the $33 million listing fee and a $60 million payment, which Retirement Guide received for the sale of the management rights to the retirement villages that were sold to Prime Trust. 

Receivers to APCH from KordaMentha launched the examinations to track down the location of the $33 million that was paid to Mr Lewski on Prime Trust's successful listing in 2007. The fee was paid in 2008, the court heard. 

Destroyed documents

The court heard $27 million was deposited in the accounts of a company run by Mr Lewski's son Ari Lewski, Direct Fitness, in 2008.

In June 2008, Direct Fitness held $46.9 million, but by July 2009 all of the money had been removed from the company's accounts, the court heard. It is unclear to which companies or persons the money was dispersed. 

Mr Lewski, claiming privilege from criminal prosecution throughout the hearing, told the court that the documents pertaining to Direct Fitness's 2008 bank accounts had been destroyed. 

He delivered up the accounts from 2009 onwards to the court on behalf of his son, who did not attend the hearing as he is tending to a newborn baby. 

"Documents over sever years old were not retained by the company involved," Mr Lewski said. 

"I asked when I retrieved those statements where the 2008 documents were, and I was told they weren't obtained," Mr Lewski said. 

When asked by counsel for APCH Jonathan Moore QC, if he had contacted the Commonwealth Bank to see if they had records of the 2008 bank accounts for Direct Fitness, Mr Lewski said: "I did not think that was required". 

Adjourned for business and travel

Mr Lewski told the court he did not know what Direct Fitness did with the cash. 

"Direct Fitness was an entity where funds from various entities were aggregated and merged until they were required and redeployed in the future," Mr Lewski told the court. 

The court heard Ari Lewski would be summoned to give evidence at a future examination into the matter. 

When asked about the fate of $50 million that was held by Retirement Guide, Mr Lewski said he could not recall.

He was not asked about the fate of the remaining money Retirement Guide received for the rights.  

The examination has been adjourned until February 3 to allow Mr Lewski to see his clients in Queensland and travel overseas for a holiday. 

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