Westpac drops $720,000 claim against Forum Group co-owner Eric Constantinidis after settlement

The banking major strikes a deal to settle its case against Forum Group co-owner Eric Constantinidis after claiming the businessman had received $720,000 of fraudulent funds.

Our Kloud CEO Eric Constantinidis' Audi.

The cousin of accused Forum Group fraudster Bill Papas has agreed to a peace deal with Westpac over money he was allegedly sent in breach of a freezing order.

The banking major, led by chief executive Peter King, has withdrawn its claims against Our Kloud chief executive Eric Constantinidis after the two sides agreed a confidential settlement on Monday.

Westpac had alleged Mr Constantinidis was in possession of $720,000 allegedly sent to him by Mr Papas, after the bank placed freezing orders on the former Forum Group boss.

Westpac is pursuing Mr Papas over his role in an alleged $500m fraud, which saw the bank lend almost $300m to the Forum Group to fund leases on office and industrial equipment that did not exist.

Mr Papas allegedly used the funds from the alleged scam to purchase a string of luxury properties around Australia and Greece as well as a football team in the Thracian town of Xanthi.

Westpac claimed that after Mr Papas became aware the bank was investigating the alleged fraud he sent $720,000 to Mr Constantinidis.

Mr Papas allegedly withdrew $750,000 from his Macrovue trading account in breach of urgent freezing orders Westpac had put in place to stop him removing the allegedly fraudulently obtained funds.

However, Mr Constantinidis claimed the money was to repay a near $1.3m debt incurred by Mr Papas to cover car repair costs, driving lessons, and legal bills.

Westpac declined to reveal the nature of the settlement with Mr Constantinidis, and Mr Constantinidis did not respond to requests for comment.

The Federal Court ordered no costs be paid by either side.

The move to drop the case against Mr Constantinidis clears the way for Westpac to proceed in a trial of its claims against Mr Papas and his associates early next year.

Westpac recently expanded its case against Mr Papas’ Greek business partner Anastasios Giamouridis, who the bank claims received fraudulent funds from the scheme to bankroll the production of waste digestion machines.

The $720,000 skirmish with Westpac is not Mr Constantinidis’ only fight in the Forum Group saga.

The Sydney resident was also embroiled in the case after McGrathNicol liquidators seized and sold his Our Kloud branded R8 MLS EVO racing Audi.

Mr Constantinidis raced Audis with Mr Papas.

Forum Group and Iugis CEO Bill Papas' Audi.

McGrathNicol liquidations of the Forum Group sold two Audi Race cars, used by Mr Constantinidis, Mr Papas and his business partner Vincenzo Tesoriero.

The move to drop the case against Mr Constantinidis comes after the Our Kloud boss bought the Forum Group off Mackay Goodwin administrators in July 2021.

Mr Papas placed the Forum Group into administration ahead of Westpac securing orders that the business be wound up.

Our Kloud held the Forum Group’s data but repeatedly denied Westpac access to the files until ordered to hand over the files by the Federal Court.

Under the terms of the sale, 72 staff were able to retain their entitlements and Our Kloud gained the contracts to service leases for the real printers and photocopiers which had been distributed by the Forum Group.

Our Kloud paid cash for the Forum Group in a deal Mr Constantinidis said at the time was an “amazing opportunity for the expansion” of the data management company.