The Grounds owner buys almost $5m in property despite tax debts
Four companies that were used to run The Grounds cafe empire were liquidated after running up $1.6m in tax debts. That didn’t stop another company owned by The Grounds’ director Ramzey Choker from buying almost $5m worth of property.
NSW
Don't miss out on the headlines from NSW. Followed categories will be added to My News.
The Grounds cafe empire failed to pay $1.6 million in tax but another company owned by its boss spent almost $5 million on a property buying spree.
The Grounds director Ramzey Choker is the sole director of a company known as Fluffy Investments, which spent $4.9 million on four properties in Sydney’s property market over six months in 2019.
The property buy-up came as liquidators examined the financial books and dealings of four companies that were previously used to run The Grounds empire after they were put in the hands of receivers owing $1.6 million to the Australian Taxation Office for the three years ending in 2018.
The companies were put into liquidation in December 2018 and were used to run The Grounds of Alexandria, The Grounds of the City, The Potting Shed restaurant and The Grounds wholesale coffee operation.
MORE BY BRENDEN HILLS:
‘Drug kingpin’ coached NRL star on how to deal cocaine
Ibrahim associate: ‘I was directed to smuggle drugs’
Mr Choker ceased to be a director of three of the companies in 2018 while his former business partner, Jack Li Ming Hanna, remains listed as a director of all four.
Asked the source of the money used to buy the property, Mr Choker responded through his lawyer Mark O’Brien who said it was not from the liquidated companies.
“The properties … owned by Fluffy Investments were purchased with funds from Mr Choker’s personal resources,” Mr O’Brien said.
Mr Choker’s ex-business partner, Mr Hanna, could not be reached despite attempts at two properties listed under his name on business records.
Despite the liquidation of the companies, The Grounds continues to run after the business operations were transferred into other companies.
Meanwhile, the liquidator’s reports said most of the assets had been sold or transferred to other companies and the bank accounts all but empty or in deficit.
Mr O’Brien previously said that any assets transferred from the companies were sold at fair market value.
It was the second time a group of companies used to run The Grounds had been put into liquidation.
Between 2014 and 2016, three other companies were put in the hands of receivers owing $1.7 million to a range of creditors, including $1.3 million to the ATO.
Liquidators have now recommended the corporate regulator ASIC investigate Mr Choker and Mr Hanna for a range of corporate breaches that if proven could see them banned from directing companies for up to five years.
Meanwhile, an investigation by The Sunday Telegraph has revealed that other companies associated with Mr Choker and Mr Hanna have been buying up property.
Mr Choker has been a director of Fluffy Investments since 2015 and is currently its sole director, business records said.
Mr Hanna was the director of the company between 2015 and 2018.
Property records showed the company paid more than $2 million combined for two apartments on Jullian Cl, Banksmeadow, on June 3, 2019.
Three months later, the company bought a storage shed in Bourke Rd, Alexandria, for $135,000.
The final property purchase was a block of four units in Dulwich Hill for $2.8 million on 28 November.
Mr Choker and Mr Hanna quit as directors in 2018 and 2019 respectively of another company known as Jackson 7 Investments that bought three properties.
One included an Alexandria storage shed that it purchased for $1 to buy out a joint ownership from Fluffy Investments on September 16, 2019.
No links between the property purchases and the failed companies have been identified in the liquidator’s reports.
An ASIC spokesman said: “When an entity has been liquidated the responsibility for recovering the debts of the entity rest with the appointed liquidator and are governed by the Corporations Act. The ATO has no special powers in this regard.”