Queensland police say they will continue their inquiries into the circumstances surrounding the transfer of 37 properties in Toowoomba valued at $6.2m from a non-profit Aboriginal cooperative to a private company which then mortgaged the assets multiple times before defaulting on the debts incurred.
After an emergency meeting with a group of affected residents on Tuesday, Insp Stephen Angus of the Toowoomba local command confirmed on Wednesday police inquiries into the matter will continue to determine whether fraudulent activities have occurred.
Another meeting with the taskforce attempting to put a freeze on the recent fire sale of 36 of the properties which is scheduled for 20 March.
The announcement follows the confirmation on Tuesday of an Australian Securities and Investments Commission (Asic) investigation into the potential breach of directors’ duties that led to the transfer of the 37 properties from the non-profit Downs Aborigines and Islanders Company to the Downs Housing Company Pty Ltd in 2016.
On 13 October 2017, 18 months after the transfer of the properties to the Downs Housing Company, its sole director, secretary and shareholder, Geoffrey John Hirning, had a creditors petition filed against him.
Three days later Hirning began to take out multiple mortgages amounting to almost $4m on the properties. The credit leveraging and multiple transfers of these mortgages continued until October 2018.
In January, Stewart Levitt, a senior partner at Levitt Robinson Solicitors, urged Asic and the Queensland police to immediately investigate the transfer of the assets to the Downs Housing Company after it became clear only two directors – Michael McCarthy and Lesley Suey – from a board of seven from the non-profit Aboriginal housing cooperative signed the transfer documentation. Both signatures were unwitnessed.
On the eve of the sale of the 36 properties last month, Levitt said there was a question mark over the probity of the transfer of the assets from the Downs Aborigines and Islanders Company to the Downs Housing Company Pty Ltd. Levitt also suggested the sale of the properties should not be allowed to proceed.
“There should be a freeze on the sale and the assets should be preserved,” he told NITV News at the time. “The right of the mortgagee to proceed should be immediately the subject of a restraining order that Asic or the Queensland government should approach the court to obtain as a matter of urgency.”
Also prior to the sales, the CEO of the National Congress of Australia’s First Peoples, Gary Oliver, said that the federal government should buy the properties and convert them to social housing.
However, a spokesperson for the federal minister for Indigenous affairs, Nigel Scullion, said that responsibility rested with the Queensland state government.
MeanwhileQueensland’s housing minister, Mick de Brenni, has ruled out buying the properties, claiming it wasn’t “the right move” because it didn’t “take into account the individual needs of families”.
Asic initially claimed the matter fell outside of its jurisdiction due to the federal government funding the establishment of the non-profit Downs Aborigines and Islanders Company in 1983 to provide secure housing for Toowoomba’s Indigenous community.
Meanwhile the Australian Charities and Not-for-profits Commission (ACNC) said the matter fell outside of its purview after the company’s charity registration was revoked in 2017, following an investigation into the organisation’s activities and operations.
Last Friday, the Queensland Greens member for Maiwar, Michael Berkman, wrote to Queensland police local command and the state’s police commissioner, Ian Stewart, requesting a “vigorous” investigation into the matter.
“The tenants dispute the legality of this transfer on the basis that a general meeting of the former company (Downs Aborigines and Islanders Company) was not held,” wrote the member for Maiwar.
“One person involved in this transfer was in 2002 convicted of around 30 counts of fraud in similar circumstances. Over the next two years the properties were mortgaged to a range of investors. Tenants continued to pay their rent, but the loans were never paid back …”
In the letter, Berkman said the circumstances of the auction – in which 36 of the 37 properties were sold in one day – were also suspect, with a very short marketing campaign. “This approach seems to ignore the obligation of mortgagees to achieve the best possible price in a mortgagee sale,” he wrote.
“The circumstances of the auction are also suspect, since all 37 properties were sold on one day, with a very short marketing campaign. This approach seems to ignore the obligation of mortgagees to achieve the best possible price in a mortgagee sale.”
But last week, Queensland police said they hadn’t seen enough evidence to investigate Hirning and Downs Housing.
“Police have met with concerned persons in the community and have sought further documentation which shall be reviewed upon presentation,” they said in a written statement.
Levitt said the tenants now have few options other than to put pressure on Asic and the Queensland government to act.
“The way I see it, Asic and the government now have a responsibility to investigate, they’re probably the only ones with the power to do so.”
Former board member of the Downs Aborigines and Islanders Company, James Boney, said the community taskforce is also in the process of re-registering the company, which could potentially give the group access to documentation to dispute the sale of the houses.
Both Boney and Tyrone Pearce, a member of the community taskforce fighting the sale of the houses, say they will not give up.
“We’ve come all the way to Brisbane and we’re not leaving until we get heard,” Pearce said.
“We are prepared to sit in anyone’s office that we have to. We’ve got nothing to lose. We’re feeling exhausted but we’re willing to keep on fighting to save these homes.”
Additional reporting by Michael Carey, Ella Archibald-Binge and Keira Jenkins
This story was produced in conjunction with NITV
