Wife says fraud accused 'mover and shaker'

NICK KRAUSE
Last updated 05:00 30/10/2012
Loizos Michaels
Sunday Star Times
LOIZOS MICHAELS: On trial for fraud.

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The estranged wife of a man facing a raft of fraud charges was bankrupted due to her husband's growing appetite for spending, the Auckland District Court has heard.

Caroline Wood yesterday gave evidence against her husband Loizos Michaels who has pleaded not guilty to 31 fraud charges involving losses of more than $3 million.

The pair had married in Queensland in November 2004 and she knew him then as Michael Loizou. Michaels told her he was from Cyprus and his father had passed away and that he'd received an inheritance of millions through part-ownership of Louis Cruiselines.

"He said he would be stepping into his father's role, he would be receiving shares his father had in the company," she said.

"He said to check on the Cruiselines website. There were names on the website that confirmed what he was saying but he was concerned his photo (and details) had been taken down from the website - he was surprised it was not there."

Michaels also claimed to play the stock market and had Bloomberg stock market screens running.

After their son was born in 2005 Michaels disappeared and his former wife returned to New Zealand. Michaels was arrested in Sydney when trying to travel here and the family eventually reunited in Melbourne.

They returned to New Zealand in 2006 when Wood's mother was diagnosed with cancer.

She said Michaels began taking over control of her company Trades R Us, a one-stop shop through which tradesmen could be booked for jobs.

With her name on everything from the family's BMWs, their various mortgages and the business too, she worked hard to keep control of finances. But Michaels began taking over everything from hiring people to various roles, creating a new Greek restaurant and buying more cars. He was also a compulsive gambler who rarely spent time at home, she said.

"My role was to keep him reined in - he was the mover and shaker," Wood said.
 
She eventually stepped aside and he took over running Trades R Us.

"I wasn't able to account for anything. I personally guaranteed everything," she said.

"I had credit accounts for major suppliers. That's why I wanted to engage contractors so I didn't (run) up costs in my name, which is what happened."
 
Her husband would direct workers to use the suppliers' accounts at will, she said.

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"Initially it was okay, and then it just snowballed.

"I'm bankrupt now. My son and I lost our home. It went to mortgage sale. We've been grovelling around for the last couple of years."

She told the court the couple's three Auckland homes went to mortgagee sale on or around February 22, 2010.

The case resumes on Thursday.

- BusinessDay.co.nz

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