A CURIOUS case of a phantom Lamborghini has left a car finance company red-faced and out of pocket. It has also exposed the seedy side of a Sydney prestige used car dealership.
On one side of the saga was BMW Finance, which writes millions of dollars of loans a year. On the other was the Rose Bay car dealer Galleria Veloce - formerly owned and run by a businessman who is serving a 17-year sentence for importing 60 kilograms of amphetamines aboard a cargo ship.
Unwittingly caught in the middle was Rodney Adler's one time-friend, the property developer and nightclub owner Ghassy Bayni.
Five years ago, mortgage broker George Nahed owed Mr Bayni more than $150,000 but, rather than just repay the debt, Mr Nahed proposed a mates' rates deal on a luxury imported sports car.
The bright yellow Lamborghini Gallardo coupe, with registration plates IMBRKE, was ostensibly worth $350,000.
On the evening of March 18, 2006 Mr Nahed drove the almost-new 2006 model car to Mr Bayni's Double Bay house for a test drive and Mr Bayni was keen to proceed with the sale. But before Mr Bayni could keep the car he needed to come up with $200,000.
Rather than buy it outright, Mr Bayni wanted to lease the car - a popular method among high flyers seeking to reduce tax bills.
Mr Nahed offered to arrange for BMW Finance to buy the car, then lease it to Mr Bayni.
But that was the last Mr Bayni heard of Mr Nahed, who has since disappeared.
The dealership selling the car was Galleria Veloce, which specialises in importing exotic European vehicles that are not usually available in Australia. Galleria accepted the $200,000 payment for the car from BMW Finance but never produced it.
BMW Finance, red-faced and $271,000 out of pocket, went to the NSW District Court to force Mr Bayni to pay the money.
Judge Leonard Levy described the process as ''as an elaborate fraud'' but he stopped short of naming a perpetrator.
On the day the $200,000 was paid, Galleria Veloce was placed into receivership by its lender, GE, which had lent Galleria $2.5 million secured against its floor stock.
When the receivers arrived at the Rose Bay showroom they expected to find 20 luxury cars, but found only three. All the rest had disappeared.
GE never recovered the loan to the car dealership. BMW Finance has failed to get its money back too, with the judge finding last week that its lending practices were lax and that Mr Bayni should not have to continue to pay the lease for a car he never received.
It appears BMW Finance failed to do even a basic ''REVS check'' - running its identification numbers through the Register of
Encumbered Vehicles - before handing over the hefty sum.
''[BMW Finance] took no active steps to satisfy itself that the vehicle in question actually existed or was locatable. In my view this was a risk-laden commercial enterprise,'' Judge Levy said.
''One cannot hire to another what one does not and cannot own. Yet this is what [BMW Finance] purports to have done in this case.''
Mr Bayni's lawyer, Barry Spinks, said ''most people who are requested to pay for the hire of anything would at least expect that it existed''.
A former property development partner of Rene Rivkin and a concert promoter, Mr Bayni now leases a white Range Rover.
BMW Finance said it was considering an appeal.