Ben Hills investigates
On a cold, grey Melbourne afternoon earlier this month, a band of dignitaries assembled in the grounds of a newly built brick complex in the suburb of McKinnon, not far from Caulfield racecourse, to witness a small moment in history that even the local newspaper didn’t deem worth covering.
The mayor was there, and a brace of State politicians, and Dr David Kemp, who as well as being Federal Minister for Education, Training and Youth Affairs, represents the surrounding electorate of Goldstein.
With a few well-chosen words of praise he declared open Claremont Terrace, an upmarket $30 million hostel-cum-serviced apartment facility where soon about 135 older Australians will be enjoying the indoor gardens, massage and hydrotherapy pool.
Proudly watching the baptism of his latest baby was a burly, greying man named Ted Sent, who at 61 is himself eligible for retirement accommodation.
Not that he has any plans to kick back in the recliner just yet Mr Sent is the multi-millionaire tsar of the Australian aged care industry, and he has huge ambitions.
In less than four years, Primelife Corporation Ltd the public company of which he is managing director, largest shareholder and driving force has built, bought, or taken under management a $1.6 billion empire of nearly 100 retirement villages, hostels and nursing homes spread across four States.
In the next few years, as the baby boomers begin retiring, Mr Sent plans to double this, making Primelife Australia’s largest landlord for the aged.
His well-oiled PR machine trumpets his successes last year he was “Australia’s Most Outstanding Performer of the Year” at the Australasian Aged Care Awards and pictures him rubbing shoulders with the rich and famous.
The former Victorian premier Sir Rupert Hamer, 84, heads the advisory board of his new Renaissance TV channel, which broadcasts such attractions as Move It or Lose It Senior Aerobics to Primelife’s captive audience.
If Mr Sent achieves his ambition, that will also mean his company receives the largest slice of the $4 billion a year that the Commonwealth doles out to subsidise beds for the less well off. Primelife has just been granted an additional 293 “approved places”, as taxpayer-subsidised beds are called, taking its total to 838 each nursing home bed is worth $35,000 and each hostel bed $10,000 a year in government subsidies.
To be eligible for this bounty, Primelife has been granted what is known as “approved provider” status by the Commonwealth Department of Health and Aged Care, after the company and its “key personnel” underwent a vetting process which is supposed to protect both the aged residents and the public purse by weeding out anyone deemed unsuitable.
Specifically, the law says that the department must consider “the applicant’s record of financial management”, “the honesty of the person”, whether he or she “is or has been bankrupt” or “has been associated in a management capacity with a corporation that is or has been under the control of a receiver”. Remember those words.
These legal requirements, which are supposedly checked by the department of the Aged Care Minister, Mrs Bronwyn Bishop, make it all the more surprising that Mr Sent and his company have been able to come so far so fast, since a Herald investigation has uncovered entirely from information on the public record some ugly skeletons in his cupboard.
Specifically, Eduard Christiaan Sent, to give him his full name, has been charged (though not convicted) on three occasions with serious criminal offences, including fraud. He has been bankrupt. He has been a director of no fewer than 43 companies which have either been deregistered, or placed in administration or receivership. He was banned for six months by the corporate watchdog from taking any part in the management of a company because of his business track-record.
To the public, the way Mr Sent tells it, his is the classic poor-immigrant-made-good story.
He arrives in Australia from Holland in 1960 his exact place and date of birth vary according to which corporate record you are looking at, though he swore in his bankruptcy statement of affairs that it was Velp-Zutphen on July 20, 1940 with $20 in his pocket, and finds a job washing cars in a Melbourne car-yard.
He teams up with his long-time friend and business partner Mr Brian Forshaw, a migrant from England’s Merseyside who is a few months younger, and they pool resources to start their own second-hand car-yard.
By the mid-1960s they move seriously upmarket, starting Brent (a contraction of their names) Motors, selling luxury imported cars such as Lamborghinis, Daimlers and Jaguars from a site in suburban Oakleigh.
As the money rolls in, Mr Sent becomes known as something of a man about town he takes flying lessons, buys a Ford Thunderbird, a boat which he moors at Merimbula and uses for game-fishing, and the grand house in Eaglemont, complete with swimming pool, where he still lives with his Italian-born wife, Grace.
In 1978 he decides to expand into aircraft and buys Schutt Aviation, a sales and charter company founded by one of Australia’s aviation pioneers, based at Melbourne’s Moorabbin Airport. Mr Sent has in mind a different kind of pioneering selling imported executive jets in a highly tax-effective sale-and-leaseback scheme.
The collapse of this business four years later set the scene for the longest criminal trial in Victorian history, one which dragged on for a decade the so-called Jet Corporation affair.
Although Mr Sent had left the company before it went under, selling his shares for a handsome $4 million, he was netted in the subsequent investigation by the National Crime Authority.
In its 1988 annual report, the NCA said that Mr Sent had been committed to stand trial on Commonwealth Crimes Act charges of conspiracy to defraud over “an alleged tax-minimisation scheme … involving the importation and leasing of a foreign aircraft to an investment partnership in South Australia”.
In the House of Representatives in August 1982, Mr Barry Cunningham, then a Labor member for Victoria’s Gippsland, said that the case involved a 25-seater Spanish CASA plane which had been bought second-hand for $1 million, but repainted, imported and sold as new to a group of Adelaide investors for $2 million.
Mr Cunningham said that not only had the investors been defrauded, but the Commonwealth had been “defrauded of massive amounts of taxation” in a deal “negotiated by … Mr Eduard Sent”.
Mr Sent’s trial was repeatedly postponed pending resolution of other charges involving $10.5 million of investors’ money against the prominent Melbourne businessman Sir Andrew Grimwade.
It was not until 1994 that the saga finally finished when Victoria’s Full Supreme Court acquitted Sir Andrew on appeal, although Chief Justice John Phillip said the decision was because of the extraordinary delays and should “not necessarily to be taken to be indicative of innocence”.
In its 1994 annual report, the NCA revealed that Mr Sent would also go free. “The Commonwealth Director of Public Prosecutions advised the authority that it would not proceed with other charges of conspiracy to defraud … because of the substantial delay caused by the [Grimwade] trial, since the offence and committal proceedings,” it reported.
It was not the first time Mr Sent had been in the dock.
In 1980, Sydney newspapers reported that “the millionaire Melbourne businessman” had been arrested as he stepped from his private jet at Sydney Airport one night.
Mr Sent appeared in Redfern Court of Petty Sessions on October 2 charged with obtaining credit of $110,000 by false pretences from a Sydney finance company, Marac Australia Ltd, relating to the lease of an aircraft.
He did not plead and was remanded until December however, there are no further reports of this case on file, and Mr Sent declines to elaborate beyond saying through his lawyer, Mr Leonard Warren that “no court has made any finding of dishonesty against Mr Sent”.
His next grand venture also involved tax-minimisation this time using boats instead of planes. He built scallop-dredgers which he sold to syndicates of high-income individuals such as doctors and lawyers, and leased them back for fishing in Bass Strait.
This was supposed to return $100,000-plus a year, on top of the juicy tax benefits derived from “revenue trips” just before the end of the financial year.
The venture became such a runaway success that a massive flotilla of 60 $500,000 boats was launched in just 18 months, prompting the then primary industries minister, Mr John Kerin, to warn in Parliament that Mr Sent’s company, Allied Fisheries Ltd, was “promoting the purchase by professional people of new scallop boats on the basis of exaggerated claims about the extent of our fisheries resources”.
But within two years that company had also capsized under massive debts, with Allied blaming everything from fleet breakdowns (the propeller fell off one boat) to poor catches due to the El Nino weather effect. In 1984 the Tasmanian Supreme Court ordered the company wound up.
The following year the Tasmanian attorney-general, Mr Geoffrey Pearsall, announced that the NCA was investigating Allied’s operations, and had seized five tea-chests of documents from its former premises at Beauty Point, near Launceston. This eventually led to Mr Sent’s third appearance in court on criminal charges.
In its 1989 annual report, the NCA said that four people had been charged under the Commonwealth Crimes Act with conspiracy to defraud the Commonwealth over “an alleged tax avoidance scheme involving the formation of partnerships of investing members of the public for the purpose of purchasing and updating fishing vessels”.
The NCA told the Herald that Mr Sent and his partner, Mr Forshaw, were two of those charged. In September 1989 a magistrate found there was insufficient evidence to commit them for trial and the charges were dismissed.
Over the following years Mr Sent pursued a bewildering variety of business interests, with varying degrees of success.
The Australian Securities and Investments Commission (ASIC) data base lists no fewer than 138 companies of which he has been a director, 43 of which have either been deregistered or placed in receivership or administration.
In March 1990, after a hearing in Hobart, the National Companies and Securities Commission (ASIC’s predecessor as corporate regulator), decided that enough was enough. It banned Sent from playing a part in the management of any company a penalty it can impose on people who have been directors of two or more failed companies.
But it was only a six-month ban and corporate records list him as having continued as a director of seven companies, in contravention of the order. By September that year Mr Sent was legally allowed back in business. By the end of 1991, however, he was in trouble again this time serious trouble.
After two unsuccessful attempts to come to an arrangement with his creditors, he was declared bankrupt in April 1992 with debts of $23 million, including $2.3 million to the Australian Taxation Office which precipitated his bankruptcy.
In his statement of affairs, Mr Sent says his bankruptcy was because the “property market collapse caused properties’ devaluation, thereby causing financial pressures on companies for which personal guarantees were given”.
He said he did not own a home, had no income, no household effects, furniture or car, and his only asset was $245.25 in the bank.
Mr Sent remained bankrupt for three years, although once again ASIC records continued to list him as a director of six companies, in contravention of the Bankruptcy Act, until he was automatically discharged in May 1995, ready to start his next foray into business.
Cars, planes, fishing-boats, property now the retirement industry beckoned.
In 1997 he was appointed managing director of a small Melbourne company called Thomas Macdougall, which began life making snow, moved into property development and was now aiming to be “Australia’s leading lifestyle provider for the over-55s”.
Ted Sent had risen from the ashes of bankruptcy, and Primelife was born.
So, with this commercial track record, how does Mr Sent or the proprietors of any of the other 3,000-odd government-approved hostels and nursing homes manage to convince the regulatory agency that he satisfies the legal criteria as a fit and proper person to manage the lives of thousands of older people, and millions of dollars of public money?
After having asked for, and being given, eight days to respond to these serious issues, Mr Sent eventually declined an opportunity to present his side of the story for publication. He sent the Herald a promotional video, and referred our questions to his solicitors, who threatened legal action.
But some insight into the vetting process was gained at a Senate committee hearing last year, when Labor’s spokesman on aged care, Senator Chris Evans, grilled one of the bureaucrats responsible, Ms Mary Murnane, deputy secretary of the Department of Health and Aged Care.
Ms Murnane claimed that the department carefully vetted all applicants, including “external” checks with the police and credit agencies.
However, the gross inadequacy of these checks was revealed when Senator Evans discovered that the department had been told in May 1998 that the proprietor of another chain of nursing homes had convictions for stalking and breaching an intervention order.
It had taken 18 months to investigate the allegation (a bureaucrat wrote to the man, and he denied it), and in May 2000 the department still had not found out the truth, despite the convictions having been confirmed in media reports.
Asked about Mr Sent, however who boasts that he has had his approved provider status renewed for “the maximum term possible” Ms Murnane said confidently: “I have reviewed the situation of Primelife and its directors, and have found that there is no reason for Primelife and its key personnel not to remain an approved provider of an aged care facility … none of our eligibility criteria was breached in the approval of this company or any of its key personnel.”
The minister responsible, Mrs Bishop, declined to answer the Herald’s questions on how Mr Sent and Primelife were approved, and referred them back to her department. A department official also refused to answer any questions about Mr Sent’s background, claiming the information was “protected” beyond saying that “there is nothing in your questions to indicate that key personnel are disqualified individuals for the purpose of the act”.
Ted Sent, former bankrupt, director of 43 defunct companies, accused of crimes, once banned from managing any company, would have been relieved to hear that.
Pub: Sydney Morning Herald
Pub date: Thursday 26 July 2001
Section: News and Features
Word count: 2546
Classification: Health/Hospitals/Aged Company/Prime Life Corp/Primelife Corp People/Name/Sent/Ted/Business
Geographic area: Melbourne Australia