By Grant Shepherd

SYDNEY: It has just been confirmed that ASIC has approved funding for Deloitte to fully investigate the collapse of disgraced white goods supplier, Kleenmaid. If proven guilty of insolvency, the directors could face five years in prison.

According to the statement issued by Deloitte, the Australian Securities and Investments Commission has approved the funding for the liquidators to fully investigate the insolvency claims against directors Andrew and Bradley Young.

“This funding approval marks the beginning of the next crucial stage of the liquidation process. The investigation will focus on insolvent trading,” said joint liquidator and Deloitte partner, Richard Hughes.

“We will provide a detailed report to ASIC and then it is their decision whether or not they will bring a criminal case against the directors.”

Hughes also mentioned that the findings will be used for any civil charges Deloitte files against the company.

“At the same time the Liquidators will use the findings of the investigation as the basis for any civil action that we may bring to recoup monies on behalf of creditors,” he said.

“We will be providing an update on the investigation in the next few months as it is a very complex matter that will take some time to fully investigate. At this stage I would ask the creditors and consumers who have lost money to be patient while we continue our enquiries.”

In relation to the penalties awaiting the Young brothers, if proven guilty, ASIC provided the following statement.

“If dishonesty is found to be a factor in insolvent trading, a director may also be subject to criminal charges (which can lead to a fine of up to $220,000 or imprisonment for up to 5 years, or both). Being found guilty of the criminal offence of insolvent trading will also lead to a director’s disqualification.”

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[Fri 25/09/2009 09:03:51]

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