More than $60 million of shares in Big Un Limited are held in companies set up by an accounting firm at the centre of a $10 million "Ponzi scheme".
An investigation by The Australian Financial Review revealed close business ties between Ray Walker, the Newcastle accountant who took his own life in 2015, Big Un's chairman Hugh Massie and Tim Dewhurst, whose company Smokinale owns 3.9 million shares in Big Un Limited. Ray Walker was the principal of Walker & Co, the NSW central coast accounting behind a financial scandal that left scores of clients without their life savings.
Big Un is the holding company of Big Review TV, an online video production company that makes short films for small businesses such as coffee shops, salons and hotels.
On Wednesday, the $380 million company's shares were suspended from trading after it asked for more time to respond to questions from the Australian Securities Exchange.
That followed a request by the company for a trading halt on Monday after a series of articles in the Financial Review raised questions about the company's relationship with Sydney finance company FC Capital.
The firm, which last month reported an impressive $22.6 million of quarterly cash sales, had not previously disclosed that the finance company was providing funding in relation to its customers, that it had issued three million shares to the company, and that FC had security over all its assets until April 2041.
However regulatory filings reveal several close business ties with the controversial accounting firm run by fraudster Ray Walker.
Ray Walker stabbed himself in the heart in August 2015, 10 days after a Newcastle lawyer put forward a formal notice of misappropriation to recover $650,000 of money owed to his client. That led to the unravelling of a $10 million 'Ponzi scheme' that left the firm's clients searching for their life-savings.
The victims of Ray Walker's fraud, mainly ageing Hunter Valley residents, are searching for their "missing millions" and showed up in force at the Federal bankruptcy court earlier this month to attend the first trustee hearing. The next hearing will be held next Wednesday, February 28th.
The Financial Review investigation reveals a complex network of related companies, that Ray Walker was a close business partner of Mr Massie, and that Big directors and management called on Walker and Co to establish companies to house their shareholdings.
Ray Walker was a former director and shareholder of Big Un chairman Mr Massie's investment company, 5G Capital.
From here the links continue. 5G Capital owns one third of Urgent Equity & Finance alongside two-thirds shareholder RBW Nominees, a company controlled by Renee Walker. Urgent Equity was set up in July 2014. Ms Walker is married to Ray's son, Brett, who worked alongside his father in the practise for more than 25 years.
RBW Nominees was previously controlled by Ray Walker and is the same entity that emerged as the top shareholder of ASX listed digital wagering company TopBetta in late 2015.
RBW was also an initial shareholder in Big Un Limited, holding over 2 million shares when the company found its way onto the ASX via a reverse merger with Republic Gold in November 2014.
By 2016 RBW held 1.25 million shares and by 2017 it was no longer among Big Un's top 20 shareholders.
The director of Urgent Equity is Mr Dewhurst, who currently owns 3.9 million of shares in Big through his company Smokinale.
In 2017, Smokinale was issued with 783,000 shares at 15¢ and 20¢ in March and April. The holding soared in value as the share price reached almost $5 in November.
Big Un Company filings show Ray Walker's son Brett was also issued with 54,000 shares in the company in March 2017, according to company filings.
The controversial accounting firm was responsible for setting up several entities controlled by the management and founding shareholders of Big Un.
They include Richbrandson Ltd, which houses the shares of Brandon Evertz, the 23-year co-founder of Big Un. Walker and Co also established Tink Nominees, controlled by Big Un director Sonia Thurston; Mr Dewhurst's Smokinale; Cherryrox, controlled by Big Review TV sales director Ben Hunter; and Hairy Rock and Bald Box owned by Tim Scott, who previously served as an alternate director of 5G Capital.These entities account for over 28 million shares or 16.5 per cent of Big Un's share register. Several are among the beneficiaries of Big Un's frequent issuance of deeply discounted stock to service providers.
There are further ties between Ray Walker and Mr Dewhurst.
On 23 July 2015, weeks before he took his own life, Ray Walker transferred ownership of shares in a company called Elvishits Ltd from his company Bowen Properties to Mr Dewhurst.
Mr Dewhurst's entity Smokinale was listed among several firms that received discounted shares in Big Un by virtue of the services the company provides.
It is not clear what specific services Smokinale provided to Big Un Limited.
Some of these entities have changed their registered addresses to Active Accounting Group, the firm set up by Brett Walker and his brother-in-law David Woods. Smokinale, Hairy Rock and Bald Box are now registered at Moisson Lawyers.
There is no suggestion that anyone other than Ray Walker knew of his fraudulent activities.
Big Un did not respond to emailed questions about the services Mr Dewhurst provided, and the business association of Big Un executives to Walker and Co.
Brett Walker did not respond to emailed questions seeking clarification about associations with Big Un Limited.
Big Un is chaired by Mr Massie while founding shareholders Brandon Evertz and Sonia Thurston are also directors.
The chief executive of the company is founder Brandon's father, Richard Evertz.
Mr Evertz was previously known as Richard Evans, who had a previous run in with the competition watchdog for misleading small businesses.
Originally published @ http://www.afr.com/businessBy