Evicted Engine Room, Teneriffe, charity cafe operator linked to visa fraud case
A charity director awarded a Brisbane City Council tender to operate a cafe in a historic riverside building was the subject of a visa fraud investigation. Council says it’s now evicted the charity for failing to pay rent.
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A CHARITY which was evicted last Monday from a Brisbane City Council-owned cafe housed in a $1 million ratepayer renovated historical riverside building has been linked to an investigation by the Department of Home Affairs probing visa fraud allegations.
A spokesman for Uniting Hands Foundation told City North News that a charity co-director, Hom Pyashi, of Kings Beach, was last year asked to provide information to the Department.
It was reported in April last year, by the Sunshine Coast Daily, that Mr Pyashi was under investigation by Department of Home Affairs after the agency received a letter alleging that he was charging workers between $35,000 and $40,000 for a sponsored visa through his restaurants.
Mr Payashi, at the time, denied the allegations and a spokesman for UHF told City North News that he believed Mr Payashi had been cleared of allegations.
A Department of Home Affairs spokesman said that the department could not comment on whether not an investigation was ongoing.
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Last week, Brisbane City Council announced that it had evicted UHF from the Engine Room Cafe, housed in the former 1908-built former engine room at Teneriffe, as it had “failed to meet the requirements of their lease agreement with Council”.
Council was criticised by a residents’ group and the Opposition when UHF was awarded the tender to operate the cafe in 2017. Council spent $1.2 million renovating the heritage-listed red brick building.
Infrastructure chairman Councillor Amanda Cooper said UHF was in “rental arrears, despite Council offering payment plans, business coaching and mentoring”.
“The Engine Room is an important part of Teneriffe’s history, once housing mechanical equipment for wharves used by the wool industry and the Navy,” Cr Cooper said.
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“Council is committed to delivering value for ratepayers’ money and the information provided when selecting the operator indicated this would provide the best outcome for the community.
“Unfortunately, issues began to emerge and the operators have been told enough is enough after consistently failing to meet their obligations to both the community and their lease agreement.
“We want the Engine Room cafe to be open for people to enjoy breakfast or a coffee by the river, not disappointing people with unexplained closures and noncompliance with the lease.”
The Australian Charities and Not-for-Profits Commission lists The Uniting Hands Foundation Australia Limited as being a registered charity with up-to-date reporting. It also shows that the charity has registered no financial information since its inception, but this is a voluntary requirement under the Commission rules. The charity lists as its directors Harpreet Kaur, Hom Pyashi and Swotantra Shah.
There is no suggestion Mr Kaur or Mr Shah were asked to provided information to the Department.
The charity spokesman said the operators had missed “two or three months” of rental payments on the Engine Room lease, which was about $3300 a month. He said that the closure had “put them low”.
“We had invested money from our own pockets, about $70,000 or $80,000 for the fit-out … through UHF and our own private company. Yes, the site was given to us by council but we also invested money there. I think. because of the area it didn’t work,” he said. “We had very good intentions, and did our very best.”
Teneriffe Progress Association President Ben Pritchard said that he was “shocked and surprise” at the cafe’s closure. In July 2017, the association spoke out against the site becoming a cafe, instead calling for it to become a community centre.
“Our reaction on behalf of the community is ‘oh dear’,” Mr Pritchard said in reaction to the news today.
“After spending a million dollars converting it to a cafe … but I suppose that’s all water under the bridge now. I would like to see (the lease) go out to tender again, an open tender for a community-based coffee shop or similar type of outlet. And maybe it could (be given) to people like (charity) Footprints, which had previously expressed interest in running it as a community training facility for disadvantaged workers.”
Council Opposition Leader Peter Cumming said council should come clean and reveal how much the failed venture had cost ratepayers.
He said he wanted to know if the charity still held the lease on another council-owned site, a food-vending ‘pod’ in the Brunswick St mall.
“Labor has questioned the appointment of UHFA from Day One,” Cr Cumming said.
“This was an unknown charity yet they were awarded an opportunity more established charities would give their eye teeth for.
“Last May, Cr Quirk was adamant the rent was being paid in full. Ratepayers deserve to know when the problems started.
“Only yesterday we had a full council meeting where the Lord Mayor could have come clean after years of defending this arrangement with UHFA.
Cr Cumming said two weeks ago he had asked to inspect the files on the Engine Room but was yet to be granted permission.
“We will continue to question Cr Quirk until ratepayers get the answers they deserve,” he said.
Cr Cooper said council “was now in the process of securing a temporary operator, before a more permanent operator is secured through a competitive tender process”.
On the restaurant rating website TripAdvisor, the cafe received a 4.5 star rating, but only from five reviewers.
It’s address, 71 Macquarie St, Teneriffe, is right on the River walk and is a popular spot to stop for coffee.
Cr Cooper defended the tender process, saying the lease was awarded through a competitive tender process.
“Council undertook an open tender for the Engine Room Café and the proposal put forward by Uniting Hands was the most competitive,” Cr Cooper said.
“In their tender proposal, the operator outlined their plans to support disadvantaged people in our community and, while not a requirement, this was something Council was happy to support.
“Disappointingly, when it came to operating the Engine Room Café, Uniting Hands did not live up to Council’s expectations and we received regular reports of residents turning up to closed doors.”
She said Council issued a breach notice to Uniting Hands in December 2018 for rental arrears, and despite offers of payment plans and business coaching, the breach notices were not able to be remedied, “ultimately leading to Council’s decision to evict the Engine Room Café operator”.
She said the eviction was unrelated to the reported investigation by the Department of Home Affairs.
In 2017, Uniting Hands Foundation (UHF) founder Hom Pyashi told City North News that it was an honour to win Brisbane City Council’s tender to operate the Engine Room Cafe.
The building once housed mechanical equipment for wharves used by the wool industry and the Navy. Its six month renovation into a cafe cost ratepayers $1.2 million.
Lord Mayor Graham Quirk said UHF was chosen to run the cafe after its success operating Eighty-Eight 48, housed in one of Brisbane City Council’s Fortitude Valley “pods”, as a social enterprise.
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In April, the Sunshine Coast Daily reported that the Department of Home Affairs was investigating Hom Pyashi, with a complaint made against him by a member of the Nepalese community.
Other people who allegedly paid Mr Pyashi for residency didn’t even work in the restaurants, the man claimed, but instead worked driving taxis or at “cash in hand” jobs.
Mr Pyashi denied the allegations, and while admitted to sponsoring skilled workers before, denied ever charging them money.
“I am aware that some businesses in Australia do charge, but I can assure you that I never have,” he said.
A Department of Home Affairs spokesperson told the Daily that “attempts to exploit Australia’s permanent and temporary skilled visa programmes will not be tolerated”.
Mr Pyashi said one of his businesses had previously received a “monitoring request” from the department and had been “chastised” for failing to keep adequate records, but that he was not aware of any current investigations. Subs: do not remove
According to online news website South Asia, in 2015 Mr Pyashi was reportedly “so broke” that wife was “frantically” applying for jobs to help him out, but by mid-2017 their company had sunk $250,000 into The Engine Room cafe.
Mr Pyashi and his business partner Swotantra Pratap Shah also invested some $500,000 into Eighty Eight 48, the article claimed.
His charity, the Uniting Hands Foundation, won a tender for the cafe’s waterfront spot which was open for social enterprises to apply for — a decision which was controversial at the time given the charity had only been registered for a year.
Mr Pyashi said he gave away his share to the cafe on March 5, 2018 due to cashflow difficulties, as well as his shares in Eighty Eight 48 — both to his former business partner.
He is still listed as a director of UHF on the charity register. Brisbane City Council was asked to confirm the names on the lease of the premise, but did not respond.
He said those who accuse him may be “past employees who were disgruntled over the loss of opportunity to obtain a permanent visa”.
“Perhaps this is their way of seeking revenge and if they are so hurt by what happened, I feel so sorry for them,” he said.
“Every day I regret my generous offer to help them, only to disappoint. At all times, my heart was there to help and assist these people and give them the opportunity to make a real life change for them and their family.”
THE TENDER:
HOM Pyashi’s charity, The Uniting Hands Foundation, was controversially granted a tender by the Brisbane City Council in August 2016 despite only being registered as a charity with the Australian Charity and Not-for-profit Commission since 2015.
The tender was for a social enterprise cafe project in a historic Teneriffe building and allowed Mr Pyashi to open the Engine Room Cafe in the space.
In his bid, Mr Pyashi also offered the council a base rent of $35,000 per annum, 2 per cent of sales over $800,000, 3 per cent of sales over $1 million and 5 per cent of sales of $1.5 million as reported at the time. Brisbane City Council was asked to confirm the rent paid, but did not respond to that question.
In July 2017, Mr Pyashi told online news site South Asia that all his businesses including The Engine Room Cafe in Teneriffe and Eighty Eight 48 contributed 10 per cent of their profits to the charity, but ACNC records show his charity reported receiving $0 in its 2016 and 2017 annual information statements.
A charity that lost out on the tender bid, Footprints, recorded a total of comprehensive income of $50,266 in that time.
A Brisbane City Council spokesperson said the tender was awarded using a “variety of criteria, including how the successful organisation would give back to the local community”. Mr Pyashi told the Daily he had intended to give money to the charity, but his businesses never showed a profit. “All that happened was it drained my life savings and now I have nothing,” he said.
“It is still a registered charity, but it never received any money and importantly, it never claimed any benefit or tax relief.”
According to Mr Pyashi, he gave away his shares to the cafe in March along with those in Eighty Eight 48 in Fortitude Valley.
“What I failed to understand is that the hospitality industry is extremely hard to make a profit from and all of my businesses used up profits to support other ventures that were losing money,” he said. The media questioned the council’s decision at the time as the charity’s website was filled with holding text and stock images, but Lord Mayor Graham Quirk backed Mr Pyashi.
“This is a social enterprise with a big heart, with a percentage of the profits raised from the café going back into the foundation to support further charity work,” Cr Quirk said at the time.
Now the website boasts that donations by “the kind hearts of Australia” have aided in the construction of a primary school in Nepal and ongoing flood relief, but it’s impossible to donate on the site.
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As reported in the Sunshine Coast Daily on June 9, 2018:
A MOTION to cancel a cafe’s lease, partially owned by a businessman under investigation for allegedly selling sponsored visas, has been overruled in council.
Council leader of the opposition, Peter Cumming attempted to move an urgency motion on May 1 to immediately cancel the cafe’s lease due to uncertainty surrounding its control.
The motion was struck down 19 to seven, with Lord Mayor Graham Quirk commenting the tender was awarded “with good grace and the view locally that was a good thing to do”.
On May 29, councillor Amanda Cooper told the Infrastructure Committee that Mr Pyashi was still a proprietor of the café owing to his position as director of the charity, despite him telling the Daily otherwise.
The meeting further revealed 16 people had been employed at the cafe through traineeships as previously promised.
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