'Scam lender' wanted PR spin

A COMPANY accused of scamming millions in loan fees from Australian businesses tried to pay a PR firm to persuade people it would "take on the big four banks".

A COMPANY accused of running a scam that allegedly reaped tens of millions of dollars in loan fees from cash-starved Australian businesses tried to pay a Sydney public relations firm to persuade the media it would be "taking on the big four banks".

The company, Western Gulf Advisory, and its founder Ahsan Ali Syed, are at the centre of allegations they were able to provide billions of dollars in funds to Australian businesses caught in a credit squeeze since the global financial crisis

Mr Ali strenuously denies any wrongdoing and has launched a spirited attack on his accusers, describing them as fraudulent scoundrels.

Investigations by journalists and investors in Australia, Britain, New Zealand and India have highlighted a trail of debt.

Mr Ali and his companies are under siege as a result of a a NSW man setting up a website that accuses Mr Ali of defrauding more than $40 million from Australian businesses last year.

Mr Ali rejects claims he has misrepresented his Switzerland-based company's capacity to provide loans while taking establishment and application fees from the businesses seeking the funds.

The Australian reported yesterday that favourable media releases and positive publicity facilitated by a prominent Sydney public relations company, Jackson Wells, led many businesses to pay WGA to seek funding from Mr Ali and his companies.

Jackson Wells founding partner John Wells later "sacked" WGA as a client after concluding its claims were dubious.

It emerged yesterday that WGA privately briefed a rival public relations firm, Cannings, and wanted it to organise a media conference in which WGA would declare war on the big four banks.

A senior representative of WGA in Australia, Robyn Schneller, told Cannings in June the assignment was to "set up an urgent media event and tell the journalists that WGA will be providing much-needed funding for Australian and New Zealand businesses".

A source said yesterday: "She was wanting to maximise WGA's exposure to Australian businesses and lead them to believe that plenty of cash would be available from WGA. It was part of a plan to lift their public profile here and they seriously wanted the media to think they would be taking on the big four banks."

Cannings regarded WGA as "extremely odd" and its diligence led to the firm rejecting the lender as a client, the source said.

Cannings head John Hurst declined to comment, but confirmed he had rejected an approach from WGA.

Ms Schneller, who has sought to raise awareness of WGA in New Zealand's media, told The Australian: "I'm not going to comment in any way, shape or form."

Corporate financial insolvency firm McGrathNicol had "grave concerns" about the bona fides of WGA when Australia's financial media was publishing favourable stories about it last year.

John Cronin, a Brisbane partner of McGrathNicol, said yesterday he had "concerns regarding WGA's bona fides" when the Cubbie group of companies, of which he was an administrator, was in contact with the lender.

Mr Cronin said these concerns were raised with Cubbie's board and he "did not authorise any payment to WGA". However, Cubbie's board, chaired by former Queensland treasurer Keith de Lacy, paid about $3m to Mr Ali's company.