Westpac moves to block Forum founder Bill Papas’ push to dilute Xanthi FC ownership

Alleged Forum Finance fraudster Bill Papas is back in action – kicking off a $7.5m fundraising round for his Greek soccer outfit Xanthi FC.

Forum founder and Xanthi FC owner Bill Papas, second from right, attended his team's recent game in the Greek city of Pierikos.

Alleged Forum Finance fraudster Bill Papas is back in action – kicking off a €4.72m ($7.52m) fundraising round for his Greek soccer outfit Xanthi FC.

Mr Papas has a warrant out for his arrest – after sending $750,000 to a relative – and has been living in Europe since. He purchased the club in September 2020 and left for Greece in June this year. Mr Papas is at the centre of an alleged $500m fraud relating to his Forum printer rental business.

Westpac is pursuing him for repayment $300m which the bank claims was defrauded using false invoices and lease agreements.

Xanthi FC, now plans to issue 4.31 million new shares in the company, diluting Mr Papas’s 99 per cent stake in the club.

The new shares will be valued at €95, and approval for the issue will be put to a vote on December 14 at a meeting to be held in the club’s headquarters in Pigadia, a small town in the north of Greece near the Bulgarian border.

One Greek publication, Thraki Sports, said the meeting would be held to “herald very serious developments in the administration and the general operation of the association”. There would also be a vote on new directors, it said.

McGrathNicol, liquidators of the Forum business, told creditors – including Westpac and two other banks, Sumimoto and Societe General – that the proceeds of Mr Papas’s alleged fraud were used to fund his lifestyle overseas.

Millions of dollars have been used in investments in Greece, the United Arab Emirates and Britain.

Bill Papas at Xanthi Arena in Greece in September.

The Federal Court heard Mr Papas sent €420,000 to Greece by purchasing tea promotions company Theion IKE, while another €1.5m made its way there via a buy-in to D&D Group, purportedly a wholesaler of nuts and wheat.

Westpac is considering attempting to stop the fundraising plans at Xanthi FC, and is concerned any issuance of shares will dilute any proceeds it may receive through the liquidation process.

Specifically, Westpac alleges a company related to Mr Papas, Mazcon, fraudulently received $16.5m in funds via a lease scheme. Mazcon owns the majority stake in Xanthi FC, although Mr Papas has previously told the Federal Court that he sold his shares in the company in March 2021.

Tassos Giamouridis, named by Westpac as a recipient of the allegedly fraudulently-obtained funds, also owns a stake in Mazcon.

The bank has moved to serve documents on Mr Giamouridis and freeze his assets, claiming he took $10.7m from one of Papas’s companies. Mr Giamouridis owned and operated an industrial site in Sindos outside the Greek city of Thessaloniki, which produced waste digestion machines and which Mr Papas supplied through his company Iugis.

Almost 200 of the machines are currently sitting in a warehouse in Sydney and are set to be sold after Iugis liquidators signed a deal to shift them.

Thraki Sport, however, reported this week that the two men had split. “Information indicates that lately there has been a different approach to things between the two partners,” the publication reported. Mr Giamouridis was seen accompanying Mr Papas to a Xanthi FC game in October.

Greek sporting officials have also flagged they will investigate Mr Papas and his stake in the club.