Property tycoon Achilleas Kallakis was being chased for unpaid bills and wages in the months leading up to his arrest in relation to a £60m fraud, Southwark Crown Court heard this week.
Kallakis and his business partner Alexander Williams are facing charges over an alleged fraud against Allied Irish Bank and Bank of Scotland.
Both men are pleading not guilty to the charges.
Giving evidence this week, a number of former staff at Kallakis’ Atlas Management revealed the financial uncertainty of the business.
Former chief accountant Rodney Rezler, who quit Atlas in November 2008 after just seven months, told the court he feared the firm was trading while insolvent. “The payments position was catastrophic,” he said.
“We were being bombarded by creditors ringing, saying, ‘Where is my money?’ It became almost impossible to work, owing to the deluge of calls and bills.”
He added: “Because Atlas was not paying its bills on time, under normal circumstances, any creditor would think the company was in trouble. It was typical of a company about to go bankrupt…For quite some time I had been concerned that the company was trading while insolvent. In the past we had been able, but not willing, to pay bills on time, but now it seemed we were just unable.”
Former executive assistant Nigel Dransfield said that payments to creditors and the liquidity of Atlas changed “dramatically” following a visit by AIB auditors in September 2008.
Dransfield said that Kallakis and Williams reacted with panic to the visit, and began selling off the contents of their Mayfair HQ at 8 Carlos Place, W1.
“There was a shortage of cash and we were not being paid our salaries on time,” said Dransfield. “The building was being emptied and paintings in it were being sold.”
Dransfield also said unpaid bills were being chased by builders doing work for Kallakis in Cyprus, and by the event organisers of his 40th birthday party in Mykonos, Greece.
The pair are pleading not guilty to the charges.
The case continues.
