William O’Dwyer, who headed Sydney-based Ralan Group, one of the country’s biggest private developers until its collapse four years ago, has pleaded guilty to six fraud-related offences.
Mr O’Dwyer was accused of dishonestly obtaining, by deception, the ability to draw down on $251 million in finance for his Ralan group of companies.
Ralan Group founder William O’Dwyer was declared bankrupt two years ago. Peter Braig
The high-profile developer had a pipeline of more than 3000 apartments when it collapsed in 2019.
Its flagship project was the $1.4 billion Ruby Collection at Surfers Paradise, comprising 1600 apartments spread across four towers.
Its major lenders at the time included Westpac Bank and Melbourne finance house Wingate.
After Ralan went under, liquidators estimated it owed its unsecured creditors $323 million.
The fraud charges, covering a period between 2015 and 2018, were brought by the Commonwealth Director of Public Prosecutions after an investigation by the corporate watchdog.
The charges relate to loans advanced to Ralan companies, which were involved in residential development projects in Sydney’s city and the suburbs of Arncliffe, Turramurra and Gordon, according to the Australian Securities and Investments Commission.
“As part of the loan agreements, the companies were required to satisfy lenders that pre-sale deposits paid by purchasers of residences in the developments were held in trust before draw-down on the loans could occur,” the regulator said on Wednesday.
“Mr O’Dwyer deceived the lenders into believing that the pre-sale deposits were held in a trust account, when in fact they had been loaned by the purchasers back to the respective development company for use as working capital.”
Around $132 million was drawn down upon the facilities, with $47 million repaid by the time the companies in the Ralan Group went into administration in July 2019.
Ralan’s lenders are expected to recoup more of their exposure after they bought out and completed the development of the Arncliffe property, in Sydney’s south.
Two years after his Ralan Group collapsed leaving apartment buyers in the lurch, Mr O’Dwyer was declared bankrupt.
Since its collapse, other developers have swooped on parts of the former Ralan empire. Rich Lister Tim Gurner, backed by Wingate, took charge of a 1.3-hectare supersite at Surfers Paradise two years ago that was previously the location for a massive Ralan project known as Sapphire.
Overlooking Budds Beach, the $1.25 billion luxury apartment and hotel project has since been renamed La Pelago.
Mr O’Dwyer pleaded guilty to the fraud charges in August after first appearing in Sydney’s Downing Centre Local Court the previous month. A sentencing hearing is set down for early December.
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