'Billion-euro' company a sham, Crown tells fraud trial
A ROADHOUSE meeting set the scene for a multimillion-dollar land sale scam, a prosecutor claims.
But a defence barrister said a landowner who complained of being conned was just greedy and under pressure from a giant bank.
Rahoul Ray and Erwin Walter Filler each pleaded not guilty on Wednesday to all seven fraud charges they jointly faced over the sale of Yalanga Station near Noosa.
Prosecutor David Nardone said Yalanga owner Will Van Zetten, thinking about retirement in around 2008, made plans to sell the sugarcane and cattle farm.
Mr Van Zetten and his then-wife Joy got a $20.7million independent valuation for the land, excluding stock, plant and equipment.
The prosecutor said Mr Van Zetten hired an estate agent and sought $25-$30million for Yalanga.
The realtor introduced Mr Van Zetten to Mr Filler, who proposed a deal of 50 per cent cash and 50 cent shares in a company called Nexis Holdings PLC.
Mr Nardone said Mr Ray and Mr Filler were directors of Nexis and basically "made up" that company's value.
Jurors heard Nexis was described as a company making low-cost construction panels from waste.
Mr Van Zetten "was not attracted" to the deal initially, Mr Nardone said.
But he learned Nexis subsidiary Coburg AG bought a macadamia nut farm in a similar cash and share deal.
Mr Nardone claimed Mr Filler's dishonesty emerged at a Burpengarry roadhouse meeting in April 2010.
The key misrepresentation made was that Nexis was worth more than €1billion euros (about $1.6 billion) when shares were "practically worthless", Mr Nardone said.
Mr Nardone said another charge related to more than $1.2 million in stamp duty Mr Van Zetten agreed to pay.
Mr Filler's defence counsel Greg McGuire said Mr Van Zetten eventually got more than $5 million cash in the deal.
He said the Van Zettens knew Nexis was "a speculative company" but the deal had genuine potential.
"If it had come off, the Van Zettens would have been obscenely wealthy."
He said the Van Zettens owned multiple properties and owed more than $11million to Westpac.
And with the global financial crisis biting, Nexis was "the only offer on the table" and the Van Zettens were prepared to "punt the shares".
Westpac did due diligence before taking Nexis shares as security, Mr McGuire added.
"Who conned who?" he asked.
Mr Ray's counsel Chris Wilson added: "Was it dishonest at the time, or did it just turn out badly?"
The trial continues. -NewsRegional