Tom Karas has come a long way from the days when he was chased down the street on Nine's A Current Affair in 1995 over allegations he had cheated customers in a $3 million basketball cards vending machine scam.
And he has moved on considerably from financial problems that saw him declared bankrupt in 1997. Perched in his ninth floor office overlooking Melbourne's old police complex, he talks about his humble beginnings in inner Melbourne as the son of Greek migrants and his battle to start again and build his own successful finance and mortgage business, State Securities Group.
In fact Karas, 44, could pass for just another self-made success story were it not for his colourful clients and associates, which has seen him accused in court of money laundering for a notorious Melbourne crime family.
Denying such allegations, he readily admits to having among his customers, associates and friends the likes of Mick Gatto, the head of the Carlton Crew who was acquitted of murdering underworld hit man Andrew "Benji" Veniamin on the grounds of self-defence; members of a prominent Melbourne crime family; and John Khoury, a Gatto business associate who police alleged in court was also part of a money-laundering ring.
"I have a business relationship with Mick Gatto. I have lent him money as well as members of his family, and he refers a lot of business my way," Karas says.
Khoury, explains Karas, is also a friend and leases office space from State Securities to run a business involved in hotels.
The pair turned a quick profit after buying and quickly reselling Melbourne's Metro nightclub, although Karas denies he was acting as a front for Gatto in the deal. He says that is just one of many damaging rumours spread about him by his enemies.
He and Khoury often go on trips together to casinos in places such as Macau, although Karas insists he's just along for the ride. "I'm not a gambler, but John is a higher roller so you get comp everything," he explains.
When Gatto flew to Singapore in April with Khoury chasing the missing millions from the collapse of stockbroker Opes Prime earlier this year, he gave out the telephone number of Karas's State Securities on radio for people wanting to contact him to help recover their money. Gatto and Khoury were close enough for Karas to invite them to the christenings of both his children, one in 2006 and the second in May this year. On the second occasion Karas took guests on a cruise down the Yarra River while singer Vanessa Amorosi kept them entertained.
Karas also mixes with some of Melbourne's highest flyers. In 2005 he joined a group of others, including one of Australia's richest men, Bruno Grollo, on a visit to China to undergo stem cell treatment that promised to make them live longer. The treatment reportedly cost up to $40,000 a session and involved a series of injections with secret stem-cell activation material.
Then there is multimillionaire day share trader and car enthusiast Leo Khouri, claimed to be one of Opes Prime's biggest accounts, with shares worth $50 million tied up in the crash. Karas and Khouri were friends until reportedly falling out in December over a controversial deal over a Melbourne quarry and waste tip last year that is being investigated by the Australian Securities and Investments Commission.
Karas says there is no magic formula to his financial success but hard work.
"It is hard work and a lot of luck," he says. "It's a family business."
His biggest break, he explains, came about because his parents were too poor to join the exodus out of the inner working class suburb Fitzroy in the 1960s and '70s, when many migrant families moved to new housing developments on Melbourne's outskirts.
Instead the family stayed put and later Karas began buying Fitzroy properties while they were still cheap.
The gentrification of Fitzroy and spiralling property prices meant he could then borrow against those assets to add to his property holdings and later build his State Securities loans business. "I managed to buy three houses cheap and they went up with the property boom. I then used that as equity to buy other properties," he says.
He now owns houses, a retail complex and nightclub in the inner Melbourne suburb of Thornbury, and the floor of the LaTrobe Street office building where he runs State Securities.
His business acumen -- he boasts of having pulled his money out of Opes Prime just a week before it collapsed after a tip-off -- has earned Karas a regular seat at Gatto's table at Bourke Street restaurant Society, where the colourful identity can be found on most days.
Karas also admits he has done well on the share market, often investing in the same small resources companies as Khouri. He also owns a stake in the broking company Findlay & Co, which operated at one time out of State Securities' office and was coincidentally involved in many of the companies in which Karas and Khouri traded shares.
The charming and fast-talking Karas enjoyed relative anonymity until October last year, when Purana gangland taskforce detectives went to Victoria's Supreme Court to seize control of an up-and-coming racehorse under proceeds of crime laws, alleging the animal was really owned by a member of a Melbourne crime family.
The horse was three-quarters owned by Karas's wife, Irene Meletsis, despite Karas telling detectives neither he nor his wife had ever been to a racetrack.
In an affidavit filed with the court, detectives said they believed the horse and a number of loans organised through Karas's State Securities Group for the crime family member and his wife were "part of a large-scale money laundering operation" involving profits from alleged drug trafficking.
Records seized by the police in a raid on Karas's office showed one of the loans to the crime family for $100,000 supposedly came from a company called United Hotel Group Ltd, of which the sole director and shareholder is Khoury. The ownership of the horse was frozen, although a judge later allowed it to be auctioned for $1.8 million, with Karas's share of the money being held by the court.
Karas says he does not know when he will return to court to fight the legal battle to get the money. He strenuously denies the racehorse or the loans to the crime family were part of any money-laundering scheme. The horse came into his ownership, says Karas, simply because a borrower defaulted on a loan.
Karas says he can do without the publicity and attention he gets, in particular from Purana, ASIC and the Australian Taxation Office, which are all investigating his business deals. "I just want to be left alone," he pleads. (Credit: The Australian).