Rear Window
John Karantzis, Christmas miracle
Michael RoddanSenior companies reporterLast month, we wrote John Karantzis had been turned around by customs at Tullamarine airport on December 20, 2020, two days after the Tax Office had served to his personal email a Departure Prohibition Order tied to an outstanding $10 million tax bill, part of which related to his failure to declare to the ATO his entire $200,000 annual salary that is easily identifiable in iSignthis’ public annual reports.
Chris Jordan, you Grinch!
iSignthis chief executive John Karantzis at the international departure gate.
That DPO was issued four days after the ATO learned Home Affairs had granted him “permission to depart Australia on the grounds that he was relocating to Cyprus”.
Strange, given the ATO had politely asked Karantzis on November 25 to provide two weeks’ notice of his intention to leave Australia, which by matter of strange coincidence does not have a tax treaty with Cyprus. Instead, Karantzis on November 27 applied to Home Affairs to depart that coming January, in a trip foiled by bureaucrats.
Which brings us to this – very – Merry Christmas. As Australia (coyly) opens its borders, reuniting separated families and loved ones, Qantas ads can now showcase Karantzis, ticket and passport in hand at the Sydney departure lounge on Tuesday, mere hours after his DPO was lifted, having paid or put up a bond for the debt.
In May this year, HWL Ebsworth, responsible for Karantzis’ clogging of the court system, had pleaded with border tsars to let their client leave, given he would undoubtedly return to his wife, children and widowed mother in Australia.
A few months later, Karantzis amended a temporary freezing order so he could pay for his family’s living expenses (now curiously denominated in the euro that replaced the Cypriot pound in 2008).
For anyone interested in minimising their taxable income, it’s beginning to look a lot like Christmas ...
Video link mastery
Given the slimmed-down Karantzis is due to present an update to iSignthis shareholders next week, will he be delivering the briefing from a hot tub in Nicosia?
He’s already well-versed in video link, having addressed the Kingdom of Saudi Arabia for NSX Limited’s memorandum with Riyadh-based Ajlan & Bros Group, a deal in which the Australian embassy and Austrade “provided invaluable assistance and support”. No public expense is too small for one of Australia’s finest recent expatriates.
By the by, NSX director (and second-largest shareholder) Tony Shen (Weigou) on Wednesday dumped 9.7 million shares in NSX, or 40 per cent of his holding. What now for NSX, where Karantzis’ departure was flagged with his “current interim CEO” title in June, although that soon reverted to the previous “managing director” title. Perhaps six months is too soon for a handover.
While Karantzis wouldn’t answer our questions as to where he was going, he wished us well “from places undisclosed, which are none of your business”.
His business, ISX Financial EU Plc, which recently demerged from iSignthis, is based squarely in the Republic of Cyprus.
While the ATO has been auditing Karantzis’ personal income tax affairs for the years 2015 to 2020 (inclusive), Karantzis challenged the ATO’s revised assessments only for the years 2015, 2016 and 2017.
We don’t know whether an assessment was ever issued for 2018, a year in which there may have been a sizeable capital gains tax event triggered by the transfer of iSignthis shares from a British Virgin Islands entity to one of Karantzis’ vehicles, Select All, which could stretch up to $50 million.
The weary world rejoices ...
Michael Roddan is a Walkley Award-winning senior companies reporter based in Sydney. He is a former business and economics reporter for The Australian.Connect with Michael on Twitter. Email Michael at m.roddan@afr.com