• It remains unclear whether police will pursue an investigation into the circumstances leading to last month’s fire sale of 36 houses. (@mcberkman)Source: @mcberkman
Queensland Police remain undecided about pursuing an investigation into the circumstances surrounding the transfer of title and recent mass sale of 36 homes formerly owned by a Toowoomba non-profit Aboriginal housing company.
Michael Carey, Jack Latimore, Keira Jenkins, Ella Archibald-Binge

12 Mar 2019 - 9:27 PM  UPDATED 12 Mar 2019 - 9:30 PM

The Queensland Police Service today met with a community taskforce representing the interests of around one hundred Aboriginal residents facing eviction from their homes in Toowoomba, in the state’s south-east.

However, it remains unclear whether police will pursue an investigation into the circumstances leading to last month’s fire sale of 36 houses after a company which acquired the properties via a questionable transfer in 2016 defaulted on multiple mortgage loans totalling just under $4m  taken out between October 2017 and October 2018. 

A total of 37 houses valued at a total of around $6.2m went under the hammer on 2 February. The Aboriginal tenants, who in some cases lived in the houses for over thirty-five years, must now vacate by May. 

A spokesperson for the Australian Securities and Investment Commission (ASIC) today also confirmed that it is investigating the potential breach of directors duties that led to the transfer of the 37 properties from an Aboriginal not-for-profit company to the Downs Housing Company Pty Ltd. 

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 Aboriginal housing cooperative signed the transfer documentation. Both signatures were unwitnessed. 

Subsequent documentation revealed the sole director and secretary of the company in receipt of the transfers was Geoffrey John Hirning, a convicted fraudster. In March 2016, Hirning also became the company’s sole shareholder.

Additional documents obtained by NITV News show Hirning’s Downs Housing Company Pty Ltd acquired the properties from the Downs Aborigines and Islanders Company Ltd on 28 April, 2016. 

Eighteen months later, on 13 October 2017, Hirning had a creditors petition filed against him.

On 17 October 2017, the Downs Housing Company began to take out multiple mortgage loans on the properties. The credit leveraging and multiple transfers of these mortgages continued until October 2018.

On the eve of the sale of the properties last month, Mr Levitt said there was a question mark over the probity of the transfer that 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.”

A matter of jurisdiction

Also prior to the sales, the CEO of the National Congress of Australia's First Peoples, Gary Oliver, told NITV News 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 told NITV News that responsibility rested with the Queensland state government.

"The Minister has written to the Queensland Government to demand that it step up and take its responsibility for social housing and ensure proposer support for the residents of the Downs Housing properties," the minister’s office said in a statement. 

"It is clearly the Queensland Government’s responsibility and the Queensland Government that needs to step up and utilise the already significant funding we have provided to support their Aboriginal and Torres Strait Islander residents that have been affected by this issue."

Meanwhile, the Queensland government’s Housing Minister, Mick de Brenni, had ruled out buying the properties, claiming it wasn’t “the right move” because it didn’t “take into account the individual needs of families”.

Elsewhere, 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.

While 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 on 10 April 2017, following an investigation into the organisation’s activities and operations. 

“As the charity has been revoked, the ACNC no longer has jurisdiction over the organisation,” a spokesperson for the Commission said in a statement.

“The ACNC has no powers to investigate the transaction and sale of assets or to halt the progress of property sales. If there are concerns about the application of charitable assets, the matter may be of interest to the Queensland Attorney-General’s department.”

QLD Greens urge investigation

Last Friday, 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 thirty 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. …

“The circumstances of the auction are also suspect, since all thirty seven 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 Mr 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.

The latest news comes after tenants were dealt a blow by the Queensland Supreme Court a fortnight ago after a caveat on the sales lodged with the Titles Registry by Tyrone Pearce, a member of the community taskforce fighting the sale of the houses, was lifted.

The caveat was Lodged on February 26, the caveat was overturned three days later by the Supreme Court. 

Mr Pearce said he was not told about the Supreme Court hearing until he was notified of the results.

“I still don’t understand how it got lifted without us being present,” Mr Pearce said.

But Mr Levitt said he was not surprised the caveat was lifted.

“I told them not to lodge it. It was the completely wrong tact,” he said.“In order to register a caveat you have to have a caveatable interest in the land, which they don’t.”

Mr 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.

Mr Boney said reinstating the company could potentially give the group access to documentation to dispute the sale of the houses.

Both Mr Boney and Mr Pearce say they will not give up without a fight.

“We’ve come all the way to Brisbane and we’re not leaving until we get heard,” Mr 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.”

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