Liquidators attempt to seize Blacktown home in bid to repay Efsol creditors

A liquidator is pursuing a businessman in court claiming he illegally transferred a Blacktown house from his collapsed company to his wife.

The liquidator of a ‘sharia compliant’ investment firm is attempting to seize a Sydney property to help repay creditors owed $20 million, alleging it was unlawfully transferred by the director to his wife — for nothing.

Grant Thornton national managing partner Said Jahani has filed proceedings in the NSW Supreme Court seeking a declaration that the 2018 transaction between Equitable Financial Solutions (Efsol) and Summiya Usman was uncommercial, insolvent and voidable under the Corporations Act.

Mr Jahani is also pursuing orders that the Blacktown home be returned to Efsol, or that Mrs Usman pay the failed company $550,000.

Said Jahani. Picture: Supplied

A document filed with the court on Mr Jahani’s behalf says an email sent by Efsol’s sole director, Mrs Usman’s husband Usman Siddiqui, to a mortgage management business in 2017, “represented … the property was owned by the company” and that Mr Siddiqui “intended to cause the company to transfer the property into his wife’s name”.

The document alleges the transaction went ahead in May the following year and that “the company received nil consideration from or on behalf of the defendant”, Mrs Usman.

At the time, the company was losing money, had failed to pay tax and as facing an increasing number of formal complaints from “unfulfilled investors”, according to the document.

It is alleged that “a reasonable person in the company’s circumstances would not have entered into the said transaction, having regard to the absence of any identifiable benefit that accrued to the company”.

The defence document filed on Mrs Usman’s behalf denies all the accusations made by the liquidator, including that the transaction was uncommercial, insolvent, voidable or unreasonable.

And, according to the defence, the company received $550,000 when the property was transferred into her name.

Equitable Financial Solutions' sole director Usman Siddiqui. Picture: Facebook

Prior to publication The Daily Telegraph attempted to contact Mrs Usman and Mr Siddiqui, who are believed to now be living in Dubai. Their lawyer did not respond.

Success in the court case would help boost the potential dividend to Efsol’s 179 unsecured creditors owed a combined $20.7m.

Mr Jahani has estimated creditors could get back as much as 30c in each dollar of debt, provided he is able to sell assets including loans.

Efsol began in 2011, marketing itself as “Australia’s largest, international Islamic finance company”.

It raised funds from investors that were on-lent in sharia-compliant finance agreements. Islam prohibits the charging of interest.

Mr Jahani has told creditors that Efsol borrowed over terms of six to 18 months, but its loans were as long as 30 years, which was unsustainable.

The Australian Financial Complaints Authority (AFCA) has awarded $4.7m of compensation to Efsol customers since 2018.

But about half of the 117 complaints brought to AFCA have been frozen while the federal government establishes a new compensation scheme of last resort covering insolvent financial firms.

Originally published as Liquidators attempt to seize Blacktown home in bid to repay Efsol creditors