WHEN Peter Berlowitz wanted to buy Australia's most luxurious snowfields apartment he jumped in his luxury helicopter and flew to Queensland to seal the $7.5 million deal. He always liked to travel in style.
A confident and, some say, brilliant salesman, Berlowitz regularly used the $2.3 million helicopter to fly from Melbourne to Mount Hotham to ski.
His love of skiing and the finer things in life was the reason he decided he had to have the five-bedroom Mount Hotham penthouse in the Ray Group's Bale apartment project. He handed over a $200,000 deposit for it two years ago but the penthouse, with its projected sweeping views of the alps, is yet to be built. (The 41-apartment project, according to the developers, is expected to be open by the 2010 ski season.)
Unfortunately for more than 400 people who invested $35 million with Berlowitz, the business empire he created is now gone and Australia's corporate watchdog is considering laying criminal charges against the former Esanda executive and personal development trainer.
A Federal Court judge found Berlowitz's HLP Group of companies had been operating as an unregistered managed investment scheme.
One of his companies, HLP Financial Planning, according to the Australian Securities and Investments Commission, had been offering investors returns of 5% in the first year of investment, 11% in year two, 57% in year three and 67% in year four. It was promoted as a business that "seeks out and develops worthy investment opportunities for its clients".
An ASIC spokeswoman told The Sunday Age last week that investigators were awaiting a final report from the court-appointed liquidator to Berlowitz's group of companies, George Georges, before deciding whether to take any action.
The spokeswoman said that if Berlowitz was found to have breached the Corporations Act, a brief of evidence would be compiled for the Director of Public Prosecutions recommending criminal charges be laid.
Berlowitz's lawyer, Graham Lederman, refused to comment.
Berlowitz, a father of four who lives in Hampton, claims that at least $18 million was lost in failed investments.
A Berlowitz family company, Korlea, also owes Beachmore, another HLP Group company, more than $7.9 million from a so-called revolving loan facility. The money does not have to be repaid until 2013.
Mr Georges said many investors had been given a personal guarantee by Berlowitz that their money was safe and, as a result, were clinging to the "blind hope" that he would eventually pay up.
Mr Georges' final report on Berlowitz and his companies is expected to be handed to ASIC within a month. He declined to say what the report might recommend but his preliminary report into the HLP Group filed with the Federal Court last year — a copy of which has been obtained by The Sunday Age — gives an insight into how a lot of money had been spent on a fleet of expensive motor vehicles "to give a perception of success to prospective clients". The cars included a 2006 Ferrari 612 Scaglietti worth more than half a million dollars.
"I am of the preliminary view that the companies in the (HLP) Group did not maintain financial records in accordance with the provisions of the Corporations Act and, as such, the records available to me do not appear to correctly and adequately explain the group's transactions and financial position and performance," Mr Georges said in his preliminary report.
There was little hope investors would see much of their money again, he said.
