Salvatore Sgherza quizzed over collapsed building company’s cheques

Salvatore Sgherza allegedly issued himself $430,000 in cheques from a failing building company’s account, a court has heard.

Salvatore ‘Sam’ Sgherza was quizzed about $430,000 in Build 29 cheques signed in his name Picture: Tricia Watkinson

A notorious Adelaide developer allegedly issued himself $430,000 in cheques from a building company that later collapsed with multimillion-dollar debts, a court has heard.

Salvatore ‘Sam’ Sgherza also told a Federal Court examination that he didn’t know why $233,000 was allegedly transferred from the accounts of Build 29 to a property firm connected to his daughter and ex-wife.

Liquidators are probing former and current directors of Build 29 which ceased trading in July 2018 with debts of $4.65m after financier CEG Direct Securities took over its assets and control of the August Towers apartments on the corner of Hutt St and South Tce.

Mr Sgherza, a former director of Build 29 and discharged bankrupt, was questioned in a full day hearing on March 18 about his knowledge of the company’s finances, management structure and business dealings.

Salvatore ‘Sam’ Sgherza, pictured in 2019, has been questioned about operations of failed building company Build 29. Picture: Russell Millard

When Barrister Lewis Gentry, acting for Build 29 liquidator SV Partners, suggested Mr Sgherza had issued Build 29 cheques to himself from “time to time”, Mr Sgherza said he couldn’t remember.

Mr Gentry then referred to Build 29 cheques issued to Mr Sgherza as payee on April 28, 2017 for $211,929.50, another on the same day worth $66,000 and further undated cheques of $90,000 and $69,000.

“Can’t you recall issuing cheques to yourself,” Mr Gentry asked, to which Mr Sgherza said “we would cash those cheques”.

Mr Sgherza – who described himself as the company’s construction supervisor – said he “can’t really remember” when asked if he applied any of the funds for personal expenses.

“The company office had a cheque book, we would pay bills from the cheque book,” he said.

He did not know why money was not transferred from the company bank account to pay bills.

Mr Gentry also pointed Mr Sgherza to payments of $233,000 from Build 29 to entities connected with Gold Crown Management Group between 2016 and 2018.

Mr Sgherza said Gold Crown was a rental company, which involved his daughter and ex-wife Marisa Sgherza, and shared an office with Build 29 from “time to time”.

Mr Sgherza said he did not know why Build 29 had made the payments.

“Can I suggest that Marisa and Deanna received the benefits of these transfers,” Mr Gentry said, to which Mr Sgherza replied “I don’t know”.

Build 29 was building the August Towers apartment on the corner of Hutt St and South Tce when it collapsed with debts of $4.65m. Picture: Naomi Jellicoe

He also couldn’t recall why Build 29, Mr Gentry said, allegedly paid $18,000 to his daughter’s personal account.

Mr Sgherza was Build 29’s initial sole director between July, 10 and August 1, 2012 and again from September 14, 2017 to October 31, 2017.

His sister Elizabeth Fragnito and Mr Sgherza’s son Sam Jnr were sole directors in intervening periods until Sam Jnr handed control to Teresa Sgherza, Mr Sgherza’s sister, in May 2018.

Mr Sgherza couldn’t remember the circumstances that led to CEG – which Mr Sgherza described as a “loan shark” – confiscating the business and family assets.

Mr Sgherza did not know how much he was paid as a salary, and was unsure if he had signed an employment agreement.

He could not remember receiving pay slips nor recall which banks Build 29 used, although he remembered “seeing Bank of Queensland”.

Adelaide property developer Sam Sgherza in 2010 at North Haven where he built the Crown Marina before he was made bankrupt in 2012.

Mr Sgherza agreed he was signatory of company bank accounts and had authority to deal with company funds when not a director.

He is currently facing a dozen separate charges over allegations he falsified documents and stole more than $300,000 from North Adelaide accountant Bruno Battistella between March 24, 2017, and June 8, 2017.

Magistrate David McLeod issued a warrant for Mr Sgherza’s arrest on March 12 after he failed to attend a hearing in the matter.

Mr Sgherza is yet to enter a plea.

Mr McLeod separately spared Mr Sgherza jail in 2018 but fined him $10,000 after the businessman pleaded guilty to illegally withdrawing $247,000 from bank accounts before declaring bankruptcy in 2012.