By CAM LUCADOU-WELLS
The administrator of collapsed builder Botanic Homes says a decision on whether to report Botanic’s directors for possible insolvent trading is imminent.
Botanic Homes met with administrators nearly four weeks prior to it going into voluntary receivership on 3 May while at the same time appearing to hire still-unpaid tradie-contractors.
Botanic Homes owes up to $5 million to 250 creditors including customers and tradies. One tradie told Star News he was owed $200,000 and had been assured of the company’s financial viability up to the day it folded.
He held small hope of recovering the debt.
Administrator Jason Stone of PKF Melbourne said an “in-depth investigation” of the directors Robert Bender and Craig Garvey’s conduct would likely occur after the Hallam company’s future was decided by the end of August.
He said a report would be prepared for corporate regulator Australian Securities and Investments Commission on whether the directors’ conduct was “appropriate”.
In June, Mr Stone told Star News that PKF believed the directors were trading insolvent but “it’s difficult to prove”.
“From what we have in our possession, the records we have reviewed … it appears the company has been insolvent in the last few months leading up to the appointment and there is a claim of insolvent trading,” he said.
Under law, PKF must report the directors if there’s a suspicion of any offences, such as insolvent trading.
PKF can also prosecute the directors to claim any new debts incurred while trading insolvent.
“We advise ASIC regardless of whether we prosecute the directors or not,” Mr Stone said.
“It’s up to ASIC to determine if they take further action against the directors. I suppose ASIC has limited funding and are quite selective on which matters they take on and which they don’t.”
Mr Stone said directors Mr Garvey and Mr Bender were among the listed creditors, claiming unsecured loans they contributed to alleviate “some working capital difficulties”.
The directors’ claim could be used to offset any prosecution for insolvent trading debts against them, Mr Stone said.
Meanwhile, customers who are left with partly or completely unbuilt Botanic Home houses say they are frustrated by delays and extra costs as they chase insurers and PKF.
An ASIC spokeswoman said the regulator was unable to comment on whether it was investigating a company and its directors.
