The liquidator handling the affairs of collapsed Perth authorised representative network Winley Insurance Group issued its first report to creditors.
The Company’s known liabilities to date total $3,310,600 comprising priority creditors totalling $9,047 and unsecured trade creditors of $3,301,553.
Prior to the appointment of liquidators, ASIC commenced investigations into the company’s failure to lodge annual audited financial statements for the financial year ended 30 June 2014 onwards. As a result of ASIC’s
investigations, the Company’s AFSL was revoked in May 2016 and the director was permanently banned from working in the financial services industry.
Liquidator Neil Cribb of RSM Australia Partners says in the report, “My preliminary investigations, including limited tracing of monies, indicate approximately $8.69 million of Company funds and Trust Funds appear to have been misappropriated during the period December 2013 to January 2016 primarily to PEF, although represented in the Company’s financial records (at least to 30 June 2015) as a possible loan.”
It is stated in the report that unless significant recoveries are made, the liquidators do not expect a dividend distribution to any class of creditor.
Cribb says his preliminary investigations suggest the causes of failure of the company were under capitalisation, poor financial control including lack of records, poor strategic management of the business, trading losses and inadequate cash flow / high cash use.
The liquidator has called a meeting of creditors at the offices of RSM Australia Partners, 8 St Georges Terrace, Perth WA 6000 on 20 September 2017 at 11:00am (WST) to consider the progress of the winding up.