The director of a plumbing company that went into liquidation owing over $12million had been paying himself a six-figure salary in the months before the collapse.
C & S Plumbing Pty Ltd, in Benalla in Victoria’s northeast, collapsed on March 27 with $0.0 in its bank account and owing $12.2million to over 100 creditors.
Simon Nelson from BPS Recovery and Reconstruction has been appointed as liquidator of the business, which also has an office in Melbourne.
C & S Plumbing still offers services for commercial and residential projects on their website, which as of this week is still live.
Of the $12.2million the company owes, $1.9million belongs to 76 former employees for unpaid wages, superannuation and retrenchment while $3.7million is owed to Australia’s Taxation Office, news.com.au reports.
Documents filed with ASIC by the liquidator includes allegations that the sole director of C & S Plumbing, Shane Arnold, was paying himself a six-figure salary in the months leading up to the company’s collapse.
The report states that from November, Mr Arnold ‘began to receive significantly increased wages’ before the company went into liquidation in March.
The report states that from November, Mr Arnold ‘began to receive significantly increased wages’ before the company went into liquidation in March
Documents filed with ASIC by the liquidator includes allegations that the sole director of C & S Plumbing, Shane Arnold, (pictured) was paying himself a six-figure salary in the months leading up to the company’s collapse
C & S Plumbing still offers services for commercial and residential projects on their website, which as of this week is still live
‘This was by way of cashing out outstanding annual leave and RDO balance,’ it said.
‘A review of the pay slips of Mr Arnold … indicate (s) that Mr Arnold received the gross amount of approximately $101,000′ in that period of time.’
The report also includes allegations the director sold his company’s assets to another business one of his family members is involved with.
C & S Plumbing employees were engaged by Arnold Land Development, a company whose director is a relative of Mr Arnold.
Workers spent 261 hours completing $456,665 worth of work at the block of land, however the significant sum was never paid to C & S Plumbing.
Liquidators have since requested the amount be paid back to the company.
Plant and equipment were sold to Arnold Land Development, in a ‘voidable transaction’ which can now be seized by the liquidator.
When creditors took the company to court over unpaid debts, Mr Arnold was unable to pay any of them and has indicated he will declare bankruptcy according to documents lodged with the corporate watchdog.
In giving reasons for the collapse of his business, Mr Arnold said he was owed $1million from a builder who reportedly refused to pay for work.
He added that rising costs and the pandemic had also impacted on business.
In giving reasons for the collapse of his business, Mr Arnold (pictured) said he was owed $1million from a builder who reportedly refused to pay for work
C & S Plumbing Pty Ltd, in Benalla in Victoria’s northeast, collapsed on March 27 with $0.00 in its bank account and owing $12.2million to over 100 creditors
When the liquidator intervened there were $0.00 left the company’s bank accounts.
‘I have not recovered any funds from the company’s bank accounts,’ Mr Nelson wrote in documents submitted to ASIC.
Daily Mail Australia contacted C & S Plumbing Pty Ltd and Mr Arnold for comment.
It comes just weeks after it was announced plumbing company Richstone Group Pty Ltd went into liquidation in June after a failed restructuring attempt.
The company had just $61 in its bank account at the time it went under, and owes a whopping $22million to creditors, according to documents lodged with the corporate watchdog.
Administrator David Coyne from insolvency firm BRI Ferrier, said in a document filed with ASIC and seen by Daily Mail Australia, the failure of the business ‘appeared to be the debtors not paying their debts in full’.
Staff are believed to be owed up to $816,000 including unpaid wages and superannuation, while $14million is understood to be owed to the ATO.
Richstone Group blamed worsening market conditions and the pandemic for their revenue plummeting from $65million to just $25million in the past financial year.
www.dailymail.co.uk
https://www.dailymail.co.uk/news/article-12382901/C-S-Plumbing-Pty-collapses-owing-12million-creditors.html
