Background: Binetter family members back in the spotlight

The Binetters were once synonymous with Nudie Juice, but members of the family are back in spotlight over ATO case.

The Binetter family was once synonymous for the success of one of Australia’s fastest growing companies, Nudie Juice, but this week members of the Sydney family hit the spotlight for its link to a record $125 million legal victory for the Australian Taxation Office.

Members of the Binetter family, once part of Sydney’s tight-knit eastern suburbs business community, includes brothers Michael and Andrew.

The Binetter case, one of the ­biggest tax investigations in the nation’s history that arose out of the Operation Wickenby inquiry into offshore tax evasion, claimed that members of the family grew Nudie Juice across Australia by bringing in large sums of money from overseas.

The Binetter fortune was founded by brothers Erwin Binetter, who died in 2009, and Emil Binetter, who died in 2014. Emil and Erwin had immigrated to Australia, from a Slovakian village, after World War II.

Michael and Andrew, Erwin’s sons who have both since relocated to the US, were co-founders of Nudie Juice with Tim Pethick.

Andrew Binetter started out his career as a shoe salesman and after working for a large retail chain he set up his own venture, purchasing two stalls at Paddy’s Markets in Sydney, where he sold shoes and fashion accessories.

He went on to establish businesses in the food and beverage sector and also turned his hand to property development.

The notoriously private family recently sold their Bondi Beach apartment block for $6.45m and in July Michael Binetter sold the mansion Chequers at 36 Chamberlain Avenue, Rose Bay, in Sydney’s eastern suburbs for $12.5m.

Nudie was one of the first disrupters in the competitive food and beverage space when it muscled onto the market in 2003 with freshly squeezed fruit juice. It grew from a small start-up in Sydney to a national franchise in 12 months and by 2015 it was sold to Philippine-based company Monde Nissin for $80 million.

The ATO’s investigation into the ­Binetters goes back to 2004, when ATO officers discovered a file note relating to Michael ­Binetter among documents on a laptop computer seized from ­Jersey accountant Philip Egglishaw during a raid on his Melbourne hotel room that sparked the Wickenby inquiry.

The tax office has been going after the family by proxy, funding liquidators John Sheahan and Ian Lock’s legal pursuit of them. The liquidators had a big win last week, scoring a $125m judgment against members of the family, most of which will - if it is ever collected - go to the ATO.

The ATO had issued members of the family fresh tax bills stretching back as far as 1992.

In the Federal Court ruling handed down last week, judge Jacqueline Gleeson found family members including former Nudie boss Michael ­Binetter breached their duties as directors of family companies by exposing them to gigantic tax bills when ATO investigators discovered millions of dollars of undeclared money stashed in Swiss and Israeli accounts.

Justice Gleeson said Mr Binetter was also involved in a “disgraceful episode” where members of the family paid Israeli lawyer Amiram Gicelter to organise the ­destruction of documents about members of the family’s accounts at Tel Aviv-based Bank Hapoalim.

Members of the family brought the cash into Australia using “back to back loans”, where they appeared to borrow money from offshore banks but the drawdowns were in fact backed by matching deposits in secret accounts.

Under the practice known as “back-to-back” lending, money is given to a bank and then ­“borrowed” back. This allows perpetrators to avoid tax by claiming against loan interest payments that never ­occurred.

The tax saga has hit high profile Australian investors, including Channel Ten chairman David Gordon, an investor in Nudie.

When Nudie was sold last year for $80m, the ATO managed to freeze about $50m of the proceeds but about $20m of that figure is claimed by Nudie’s original investors, which includes Mr Gordon. It is believed that Mr Gordon is owed $2.17m through his company, Lexnom.

Former Greencross boss Jeff David is personally owed $327,000 and Jack Singleton, son of John Singleton, and his fellow founders of boutique ad agency Jack Watts Currie, which has also done some work for Nudie, are owed $68,700.

Another $637,000 is owed to a trust run by a company called NTTP, run by Andrew Binetter and Samantha Kelliher, whose shareholders are Mr Gordon, Mr David and two other trust companies associated with the Binetters, Dunba Investments and Dunmaf Investments.

Between them, Dunba and Dunmaf appear to be owed about $9m.

In court today tomorrow, lawyers for the investors will ask the court to free up the frozen money so they can be repaid.