Bankruptcy bollocks

Exclusive … Keddies Kapers ... Preliminary report by Tony Barakat's bankruptcy trustee ... Millions squirreled in trusts and super out of reach of creditors ... Properties in wife's name ... Hurried transfers to be unravelled … Scott Roulstone's statement of affairs … Unfit and improper 

Mrs Barakat's Macquarie Street pad - 15th floor - overlooking the Opera House

THE first report from Tony Barakat's bankruptcy trustees shows that the former Keddies' partner has potentially realisable assets of about $3,370,000 and liabilities in excess of $17 million. 

Scott Pascoe and Andrew Scott from PPB Advisory are working their way through a maze of Barakat-related companies and properties. 

In the trademark pre-bankruptcy asset shuffle the Barakat family home at 21 Loorana Street Roseville Chase was sold in March this year for $2.2 million and the proceeds transferred to pay a joint mortgage with NAB over an investment property at 60-61 Macquarie Street, Circular Quay. 

The Loorana St home was purchased for $175,000 in 1994. 

The Macquarie Street investment property is in the name of his wife Karen Barakat and is worth close to $5 million. 

Karen also owns property at Kulnura, near Yarramalong, NSW, and at 20 Malga Ave, Roseville Chase. 

Through Booklack Pty Ltd she and Tony own seven units at a property in Ashfield and with Elias Barakat she owns 26 Loorana St, Roseville. 

Those properties are unlikely to be accessible by the trustees, but it does show that Tony Barakat will continue to have a very comfortable life. 

The estimated deficiency of assets against liabilities is $13.8 million. 

Barakat gave $50,000 worth of motor vehicles to his children and wife in March and April this year, for nil consideration. 

Among his unsecured creditors is the ATO, which is owed $2.4 million. 

However, the real gold is tucked away out of reach of the trustees and creditors. 

Over $10 million is in unit and discretionary trusts, with another $2.9 million in superannuation and life insurance policies. 

In May this year the bankrupt transferred $1.6 million into a trust. This could either be a preference payment or a transaction to avoid his creditors. 

Federal Court proceedings are underway to attack that transfer. 

There are at least 16 companies with which Barakat has involvement. He holds a registered trademark, Le Wrap, which is a fast food franchise operated by various trusts. More information is being sought about this business and there is uncertainty about how Barakat calculated its realisable value. 

If Russell Keddie, Scott Roulstone and Tony Barakat dipped into their bloated trust funds they could easily afford to pay all their creditors, including the $11 million currently owed to clients who secured judgments against them for overcharging (i.e. fraud). 

Read trustees preliminary report to Tony Barakat's creditors ...

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THE trustee's report for Scott Roulstone's creditors should be out tomorrow (Friday, Aug 17). Stay tuned. 

In the meantime, his statement of affairs shows he has $3 million stashed in super and a $1.3 million life insurance policy.

A few months ago he transferred $500,000 into the Roulstone Superannuation Fund. 

At least one family trust has assets of over $1.5 million. The Kedsec Unit Trust, in which he also has an interest, has assets of over $4.4 million. 

Roulstone also has $1 million worth of shares in Slater & Gordon. 

About $1.3 million is owed to the tax man. 

The Law Society of NSW is now trying to grapple with the show cause issue - why Barakat and Roulstone should remain on the jam roll as unfit and improper people. 

On Thursday (Aug.16) society president Justin Dowd issued the following statement:  

"As to these specific matters we cannot comment at this stage.

As to the general approach to dealing with cases of this type, the Law Society council will investigate the matter to determine whether or not the solicitor is a fit and proper person to hold a practising certificate and whether conditions need to be imposed on his or her practise of the law.

The Law Society must take into consideration all the facts and circumstances of the event concerned and must make their decision within three months (s.68(5) LPA) of 'becoming aware' of it.

The Law Society will endeavour to make its decision prior to the expiry of these three months, having regard to the rights of the individual and the protection of the public."

Let's hope you now feel deeply reassured. 

See Roulstone statement of affairs filed with ITSA ...