Summary:
Sydney property developer Merhis Group reached a settlement to pay approximately $20 million to unsecured creditors, including the Australian Taxation Office (ATO), after a series of insolvencies among more than half a dozen related entities. Creditors had been pursuing unpaid GST, income tax and other liabilities arising from the collapse of multiple companies within the Merhis corporate group, which left significant debts outstanding.
The agreement followed intensive work by the joint liquidators — Stephen Hathway and Philip Hosking of HELM Advisory — who had been appointed to oversee the winding up of a number of Merhis entities and pursue recoveries for creditors. In their capacities as liquidators, Hathway and Hosking engaged with stakeholders to resolve outstanding tax liabilities and discontinued court actions that would otherwise have restrained the group’s ability to sell assets.
Prior to the settlement, HELM Advisory’s involvement also included scrutinising transactions and corporate behaviour within the Merhis group, including allegations of insolvent trading and potential phoenix activity — where companies are wound up and similar businesses are relaunched to avoid liabilities — which Merhis has denied. These investigations formed part of the broader effort to understand the causes of the group’s financial distress and protect creditor interests.
The Merhis case highlights how complex insolvencies, particularly involving inter-linked development entities, can create significant exposure for both the ATO and other unsecured creditors when tax and statutory debts are not met. It underscores the critical role that external advisers and insolvency practitioners like Hathway and HELM Advisory play in navigating creditor recoveries and settlements in large-scale corporate collapses, reinforcing the need for proactive compliance and risk management in property development ventures.
Summary:
The Australian Taxation Office (ATO) has come under intense scrutiny after it emerged that, despite becoming aware of a large-scale fraud in its Goods and Services Tax (GST) refund system, it continued to pay out millions — and ultimately billions — of dollars in refunds to fraudsters exploiting a loophole in online lodgements. According to an ABC Four Corners investigation, tens of thousands of fabricated claims were lodged using stolen or fictitious business details, with the ATO’s automated systems approving refunds without proper verification. In total, an estimated $2 billion was siphoned from the tax system before reforms and fraud controls curtailed the scheme.
Evidence from court filings and internal analysis indicates that warning signs were identified well before the scam peaked. A 2018 internal report highlighted serious weaknesses in the ATO’s fraud detection and risk assessment systems, yet those vulnerabilities persisted and were compounded when external fraud risk ratings were downgraded shortly before the exploitation took off. Even when individual cases raised suspicion, systemic delays and operational shortcomings meant fraudulent refunds continued to be processed long after alerts were triggered.
The failure not only compounded financial losses for taxpayers but also undermined public confidence in the ATO’s ability to safeguard the integrity of the tax system. In this broader context of systemic weakness, the role of external advisers and insolvency specialists — including Helm Advisory and liquidator Stephen Hathway — has come into focus. The ABC investigation notes that Hathway has been funded by the ATO to pursue recovery efforts in related large-scale GST fraud cases, including against individuals alleged to have extracted millions more from the system through networks of companies. His work underscores the importance of independent forensic review and oversight when internal controls fail to detect or prevent abuse.
The fallout from the scandal has prompted calls for accountability, reform, and stronger oversight of government agencies tasked with managing public funds. For businesses, insolvency practitioners, and professional advisers, the case serves as a stark reminder of the growing sophistication of fraud risks and the consequences of inadequate controls — reinforcing the need for robust compliance frameworks, proactive risk management, and early intervention when red flags emerge. It also highlights that, while external forensic and insolvency expertise plays a critical role in addressing misconduct after the fact, prevention and governance reforms within agencies like the ATO are essential to maintain trust in public financial systems.
https://www.abc.net.au/news/2025-07-28/ato-tax-office-gst-scam-billions-fraud-four-corners/105573446
Summary:
The Australian Taxation Office (ATO) has taken decisive action against multiple administrators in connection with an alleged $180 million tax fraud, signalling a significant escalation in regulatory enforcement and oversight of insolvency practice. The case centres on allegations that insolvency appointments were being misused to facilitate large-scale fraudulent activity — a tactic that undermines both the integrity of tax administration and confidence in professional conduct within the restructuring and insolvency sector.
Court filings and investigations indicate that a network of corporate entities, many placed into administration, were deliberately used to enable the lodgement of false claims and the improper release of tax refunds or avoidance of tax liabilities. The ATO alleges that these actions have caused substantial losses to public revenue while eroding trust in insolvency processes designed to protect creditors, safeguard revenue and preserve value.
In this context, the ATO has brought legal and regulatory pressure to bear on administrators involved in the relevant corporate collapses, reflecting broader efforts to crack down on schemes that exploit regulatory and administrative frameworks.
Helm Advisory and liquidator Stephen Hathway have also been involved in aspects of the related investigations. According to reports, the ATO has provided funding for Hathway, in his capacity as liquidator, to investigate companies suspected of participating in the alleged tax fraud and to take control of entities where necessary to protect creditor and revenue interests. This highlights the role that external advisers and insolvency practitioners can play — both in uncovering misconduct and in assisting regulatory enforcement when systemic weaknesses are exposed.
https://www.afr.com/wealth/tax/tax-office-moves-on-administrators-in-180m-tax-fraud-20240503-p5fop9
Cyan Stone Group
Summary:
A stalled residential development at Clydesdale Estate in Sydney’s north-west has left more than 150 Australian families significantly out of pocket and in limbo after construction failed to proceed and the project entered financial distress. Buyers who paid substantial deposits — typically between about $60,000 and $80,000 plus full stamp duty — have now had those funds tied up for years with no homes delivered, and they currently sit as unsecured creditors in the development’s insolvency process.
All 152 blocks of land originally sold by Boyuan Holdings Ltd (BHL) and its subsidiary Cyan Stone have become subject to complex restructuring and resale actions. In early September 2024, Cyan Stone voluntarily liquidated its companies, and Stephen Hathway of Helm Advisory was appointed liquidator to oversee the winding up of the relevant entities. As liquidator, Hathway listed the deposit holders among unsecured creditors despite the funds being held in trust, totalling around $9 million, which shocked many purchasers who expected priority treatment.
As the development unravelled, Stephen Hathway of HELM Advisory was appointed in an insolvency capacity, bringing the project under formal external administration. In this role, HELM Advisory became responsible for assessing the project’s financial position, asset values, and potential pathways for recovery or resolution, including the prospects of preserving value for creditors and affected purchasers. The case has drawn attention to how insolvency practitioners are often left to manage the fallout once developments collapse, rather than being able to prevent losses earlier in the cycle.
The case has highlighted serious governance, contractual and oversight issues in property developments, especially where complex company structures and liquidation processes intersect with home buyers’ financial interests. For developers, financiers, legal advisers, and insolvency practitioners, it serves as a cautionary example of how stalled developments can leave consumers exposed when contractual protections are insufficient and when liquidation — under professionals such as Stephen Hathway and Helm Advisory — reclassifies purchaser deposits as unsecured claims.
Merhis Group
Summary:
New details have emerged raising serious questions about the financial affairs of technology entrepreneur Richard White, including how substantial funds were directed to support the extravagant lifestyle of his American partner, Kimberlee Cvitash. The article outlines the scale of spending and the financial structures allegedly used, drawing attention to the intersection between personal expenditure and complex corporate and investment arrangements.
Amid this scrutiny, Helm Advisory — an Australian advisory and liquidation firm — and liquidator Stephen Hathway were cited in coverage relating to the sale and valuation of property or investment vehicles connected to White’s broader financial dealings. In at least one creditor communication, Hathway characterised a property sale as potentially uncommercial, raising concerns that the transaction may not have been conducted in the best interests of creditors. This added another layer of concern regarding asset management, valuation practices, and creditor outcomes.
The revelations have prompted heightened scrutiny of governance, transparency, and financial oversight. The report also details a series of investments linked to White that have reportedly performed poorly, resulting in significant losses. These failed ventures have intensified concerns about capital allocation, risk management, and the sustainability of funding strategies used to support both personal and commercial commitments.
The situation highlights how aggressive or opaque investment decisions can unravel when market conditions shift or governance controls weaken. For directors, investors, and advisers, the case underscores the importance of clear separation between personal wealth, corporate assets, and investment risk. It serves as a reminder that governance failures and unchecked financial decision-making can have far-reaching consequences, including regulatory attention, stakeholder disputes, and reputational damage. The matter reinforces the need for disciplined financial controls, transparency, and early intervention when warning signs emerge.
https://www.afr.com/technology/the-billionaire-the-beautician-and-the-backlash-20250627-p5maru
The Sands Torquay golf club and resort is being sold via an expressions of interest campaign after receivers were appointed.
2 & 2A Sands Boulevard, Torquay VIC
Summary:
The luxury resort development The Sands Torquay has been placed on the market after secured lenders appointed receivers, marking a significant escalation in the project’s financial distress and a decisive shift in control away from the original developer as lenders seek to protect and recover their secured interests. Despite the asset’s premium location on Victoria’s Surf Coast and its long-term development potential, ongoing funding challenges and an inability to stabilise cash flows ultimately led to enforcement action and the receivership appointment.
Receivership was triggered after debt pressures and unmet financial obligations became unsustainable, with the estate including a championship golf course, 112-room resort hotel, conference facilities, health club and other amenities now being marketed for sale via an expressions-of-interest campaign. The mortgagee’s appointment of receivers occurred soon after the business’s operator entered voluntary administration, with Stephen Hathway of HELM Advisory appointed by the secured lender as receiver to manage and realise the asset on behalf of creditors.
While the underlying asset remains attractive due to its multiple income streams and strategic coastal positioning, the case highlights how even high-quality developments can become vulnerable when capital structures are misaligned or market conditions deteriorate. The appointment of receivers underscores the growing willingness of lenders to act swiftly when loan covenants are breached or refinancing options fail, often resulting in a forced sale as the most viable outcome to protect secured interests.
For developers, financiers, and professional advisers, the sale of The Sands Torquay serves as a timely reminder of the importance of robust funding strategies, active lender engagement, and early restructuring efforts. Once receivers are appointed, strategic flexibility is significantly reduced, often resulting in value being realised through asset sales rather than long-term development — reinforcing the critical role of proactive financial management in preserving value and avoiding forced outcomes.
https://www.realestate.com.au/news/the-sands-torquay-on-the-market-after-lenders-call-in-receivers