South Australia water broker Bill Koufalas pays $1m after assets frozen

A retired irrigation couple had to take legal action, freezing their water brokers assets, to get paid $1 million owed on a trade.

Liquid gold: More than $1.5 billion is traded in the Murray River’s unregulated water markets, leaving irrigators at risk.

ADELAIDE water broker Bill Koufalas has taken six months to pay retired Murray River irrigators Trevor and Chris Hage $1.038 million on a 150 megalitre water trade.

The Hages finally got their money this week, but only after gaining a South Australian Supreme Court order on June 18 freezing $1.038m of Mr Koufalas’ assets.

Justice Dart’s order froze assets in Mr Koufalas’ business Trading Water Australia, which he owns with wife Teri, plus two of their properties and bank accounts.

Mr Hage said Mr Koufalas acted on the couple’s behalf to sell 150ML of Murray class three water entitlement on February 19, which the SA register shows at the time was worth about $7000/ML.

But when it came to payment Mr Hage said “the money was not coming to us and he (Koufalas) had so many excuses.

“He blamed everything from COVID to computers not coping”.

Mr Hage said it wasn’t until the freezing order was put in place in June that Mr Koufalas finally agreed to pay the money into the couples’ lawyers’ trust account this week.

The Australian Water Brokers Association has reported its members have been contacted by clients in regard to concerns over payments on trades brokered by Mr Koufalas and his company Trading Water Australia.

“Members of the Executive have been contacted by multiple parties seeking information about Mr Koufalas and/or Trading Water Australia Pty Ltd with concerns about having not received the proceeds of the sale of their water assets,” AWBA president Ben Williams said.

Mr Williams said AWBA had reported clients’ concerns to both the Australian Competition and Consumer Commission and the Inspector-General of Murray Darling Basin Water Resources.

“The AWBA Executive is aware that a number of members and affiliates may have had dealings with Mr Koufalas and/or Trading Water Australia Pty Ltd and we urge those parties to seek legal advice.

In February The Weekly Times reported Koufalas was caught trying to trade his own entitlements for more than $200,000 to irrigators, without disclosing he owned it.

The Victorian Water register shows, as of today, Mr Koufalas has still not sold his 421.7ML of Goulburn Low Reliability Water Shares.

Those shares are now worth about $168,000. But the register showed that on July 1 he had carried 399ML of allocation water over on the account, worth another $75,000.

The latest trades once again raise ongoing concerns over the lack of regulation in water markets, which has been repeatedly raised by The Weekly Times and most recently by the ACCC as part of its water market inquiry.

The ACCC reported: “there is a strong basis for concerns about the lack of obligations brokers owe to their clients and inadequate regulatory oversight of broker practices in a variety of contexts”.

“Regulatory safeguards which currently apply to intermediaries in other markets, such as real estate agents, stock brokers and stock and station agents, do not apply to water brokers.

“This means there are opportunities and incentives for brokers to engage in behaviours that would not be permitted in other markets.”

The Weekly Times emailed Mr Koufalas for comment last Friday, asking:

WHY did it take six months to pay Trevor and Chris Hage the $1.038 million owed on their trade of 150ML of class three Murray entitlement?

HAVE you brokered water trades while the June 18 Supreme Court freezing order was in place and did you inform clients? Do you think it was necessary to inform clients?

HAVE you received complaints from other clients on delays in payment on water trades?

ARE all receipts from water trades held in a quarantined trust account?

Mr Koufalas refused to answer the specific questions simply stating: “firstly, I have at all times complied with all the regulatory requirements in respect to the sale of water assets.

“Secondly, in response to the questions. Our obligations are to our customers and any details in respect to negotiations etc are confidential until a transfer of a water asset is registered, and following registration of the transfer of a water asset it becomes a matter of public record.”

The Weekly Times has regularly reported on brokers trading water on to and off their own Water Access Licences in NSW, as well as speculators entering the market when volumes are thin and their impact on pricing can be great.