Bad stench wafts in from Wellfully

Michael RoddanNational correspondent

Nov 14, 2022 – 4.19pm

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Most people know that companies hawking “wellness” products are mainly in the business of selling dressed-up bullshit.

But from the looks of it, ASX-listed penny stock Wellfully can’t even muster the courage to disguise its turds in a little glitter.

The job appears to wholly consist of lurking on gruesome online forum HotCopper. Virginia Star

Take a whiff of the $2.3 million placement Wellfully launched in early October, led by Perth stockbroker CPS Capital.

A subsequent announcement noted that, as part of the placement, Wellfully had signed up a new contractor, Dyamond Trading and Consulting, which it had tasked with ensuring “a robust monitoring of social and business media forums, and where appropriate, correcting any misleading or inaccurate statements made on those forums”.

For this job, which appears to wholly consist of lurking on gruesome online forum HotCopper, Dyamond will receive 5 million fully paid ordinary Wellfully shares.

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Dyamond will get a further 5 million shares if the Wellfully stock price rises from 2.2¢ to 2.64¢ (they make these things hard, don’t they?), and a further 10 million options exercisable at 2.2¢. At current prices, that’s a minimum $242,000 for six months worth of inane stock forum posts – even before options are converted.

What a deal for Brisbane-based Dyamond directors Krystal Hatzipapas (a National Australia Bank valuer), and Savva Hatzipapas (a fruiterer)!

Those siblings, notably, are the children of George Hatzipapas, who you may know as the former executive chairman of ASX-listed minnow Zyber.

George resigned from the Zyber board two days before he was declared bankrupt by the Federal Circuit Court in 2020.

That same year, Zyber was delisted after the file-sharing company made a failed pivot into blockchain technology. A curious $550,000 related-party loan to George for “personal assistance” also left Zyber with just $33,000 in cash.

But that was one of a number of odd expenses at Zyber, such as the $4178 in cash that was withdrawn in Las Vegas and $105 spent at a Vancouver spa.

Interestingly, two Zyber shareholders, Justin Puddick and his father John Puddick, had given $100,000 to an entity called Dyamond Developments, where George was the sole director (the Puddicks met George on HotCopper in 2017).

That cash was ostensibly to invest in a separate company, but ended up being used by Dyamond to buy shares in Zyber, which were placed in a separate entity that was associated with George. That all came out in court when the Puddicks sued Dyamond and George.

But back to Wellfully, which isn’t exactly virgin territory for the Hatzipapas clan.

A Wellfully prospectus in February this year noted an entity called GAKS Investment Holdings was its largest shareholder, with 11 per cent of shares on issue (curiously, GAKS never filed a substantial shareholder statement). Yet GAKS was absent from the 20 largest holders in Wellfully’s October annual report.

That might be because GAKS was placed into liquidation in March after the court ruled in the Puddick’s favour. George’s wife Argiroula Hatzipapas is the sole remaining director of GAKS (though George and son Savva were both previous directors).

A statutory report in June by Cor Cordis liquidator Andre Lakomy noted GAKS (which traded $10 million in ASX-listed securities over a two-year period) was likely trading insolvent from “at least 1 July 2010”.

It also made $5.8 million in suspected unfairly preferenced, unreasonable or uncommercial payments, and that the Hatzipapas directors may have breached sections of the law relating to care and diligence, acting in good faith, keeping financial records and insolvent trading (it did not file tax returns for more than a decade).

These alleged breaches were reported to the Australian Securities and Investments Commission.

The majority of the $445,036 in unsecured creditor claims relate to “outstanding legal fees and judgement debts”, presumably tied to the Puddick matter. The rest is $150,000 in claims lodged by Savva and his sister Krystal (though the liquidator noted he had not been provided with details or particulars about the siblings’ claims). You have to admire the tenacity.

The liquidator requested Argiroula provide a list of her assets and liabilities so it could assess the viability of claims lodged against GAKS. This “has not been provided”. Nor was an original trust deed for GAKS, which was apparently replaced as trustee by an entity controlled by Savva in 2021.

Wellfully shareholders are plainly upset with executive chairman Paul Peros, not only because the company’s share price is down 95 per cent since 2019. Though at that valuation, it’s a sitting duck for Wellfully director Steven Schapera’s newly established Integrated Wellness Acquisition Corp, a New York-listed SPAC.

Though you wouldn’t really want to introduce the US Securities and Exchange Commission to anything this pungent.

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