Andrew Young the CEO of Queensland Appliance Group, Kleenmaid, always presented himself as a deeply religious man, who once told me that he was Mormon with strong moral principles.
Now it has emerged that he and his son Brad have spent the last 18 months taking money from customers and not paying creditors knowing full well that his company was trading while insolvent.
In the latest of Deloitte Partner, John Greig, it has been revealed that the company has debts of over $100M and that there will little or no dividend for unsecured creditors. Also missing out are staff who are owed significant amounts of money.
“Unfortunately there is no good news for employees, customers, suppliers or creditors of the Kleenmaid Group. The financial position of the Group is worse than we initially expected.”
“Kleenmaid’s most recent financial statements indicate a significant net asset deficiency in excess of $82m. This deficiency was evident from June 2007, if not before, at which time the net asset deficiency was approximately $20m,” said Mr Greig.
“Our investigations have revealed evidence of Kleenmaid’s cash flow difficulties since at least June 2007 which confirms our initial view expressed at the first meeting of creditors, that the Group could not possibly have such a significant deficiency by reason of events that occurred in the weeks preceding our appointment as Administrators,” Mr Greig added.
Mr Greig continued, “If it can be proven that the directors have breached their duty to prevent the Kleenmaid Group from continuing to trade whilst insolvent, then they may be held to be personally liable for the unpaid debts of the Kleenmaid Group. Whilst our investigations to date have been exhaustive, they are preliminary and at this stage we consider that a potential claim against the directors for insolvent trading could potentially be the net asset deficiency of the Kleenmaid Group at the date of our appointment, which stands at $82.1m.”