In a report to creditors, the liquidator, Adam Farnsworth, of Dean Willcocks Shepard, has stated that there is over $2.8 million owed to unsecured creditors plus there is a secured loan against the property of over $1.2 million.

Contracts for the sale of the tavern to Tura Pty were settled in July 2009. On July 10, 2009, ASIC documents show a fixed and floating charge was created of $1.4 million for Tura Pty by the National Australia Bank which was signed off by sole director and secretary for Tura Pty Ltd, the company that owns the Tura Tavern, Nic Ellis.

The purchase price of the tavern was $1.22 million plus $200,000 for fixtures, fittings and transfer of liquor licence.

In the same year a number of clients in Mr Ellis’s accounting company, 2020 Group, invested in Tura Pty through a loan agreement and linked share issue. Shares in Tura Pty were sold in blocks of 40 shares, each block worth $54,000. Investors were told that the funds would be used to complete the purchase of the hotel, including associated costs, renovations and the purchase of poker machine entitlements.

Clients were told that the three-year investment would be returned in 2012 with a 10 per cent return.

When the date became due, there was no sign of the money and one investor triggered the company’s move into administration when she served two creditors statutory demands for payment of debt on Tura Pty.

In all over $4 million appears to be owed between the shareholders investment loans, trade creditors, the NAB mortgage, the Australian Tax Office and other related parties debts.

In addition to the NAB mortgage on the property of $1.22 million, over S1.6 million was raised from the shareholder investors. 

Trade creditors amount to over $87,000 and there are other creditors classed as related because the companies concerned have Mr Ellis or his father, Bill Ellis as directors.

Now under instructions from the NAB, the receiver, PPB Advisory, has been appointed but there is unlikely to be any money for “the mum and dad” shareholders, some of them local families, who used their self-managed super funds to invest in the tavern.

While some shareholders accepted that they have lost their investment, there is a growing demand to discover where the money went.   

A report to ASIC by the liquidator, Adam Farnsworth, of Dean Willcocks Shepard, (News Weekly April 17) raised concerns about possible misconduct including criminal offences, breaches of civil obligations and insolvent trading. Mr Farnsworth, who was the administrator, was appointed the liquidator on February 25.

Mr Farnsworth’s report did not name anyone in particular but pointed to possible misconduct by a past or present officer or employee of the company who may have been guilty of a criminal offence under section 184 of the Corporations Act ‘good faith, use of position and use of information’.

Mr Farnsworth indicated to ASIC that he has documentary evidence to support these allegations.

On June 13 the Tura Tavern will go under the hammer with auctioneers, Manenti Quinlan and Associates, a specialist hospitality industry consulting and brokerage company based in Enfield, NSW.

The Tura Tavern is owned by shareholders from as far afield as Broome, Queensland, Victoria, Jindabyne and the local area and went into voluntary administration when Mr Ellis called in the administrator. Despite the efforts of a group of the shareholders who wanted to keep the tavern open in the hope of trading back into financial stability, the vote went against the group and the liquidator was appointed.

Until recently Mr Ellis provided financial advice on self-managed super funds through his company, the 2020 Group, but on April 3, ASIC announced that it had banned Mr Ellis from providing financial services for six years.

The ASIC investigation into Mr Ellis and his role in the 2020 Group, which is unrelated to the affairs of the Tura Tavern, found that Mr Ellis used $200,000 given to him by a client for investment, to pay off his credit card debts and also to purchase real estate.

Following the release of the ASIC statement on Mr Ellis, he issued a denial maintaining that the client chose to invest the money with him and that he returned it all to the client.

Many of the shareholders in Tura Pty, are in the same towns as the offices from which Mr Ellis operated his financial services businesses.