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ACT Homes owes homeowners, contractors almost $1.5m

May 22nd, 2014

ACT Homes liquidator Cliff Sanderson said initial investigations had revealed 112 creditors were owed about $1.47 million, but those figures continued to climb.

Frustrated home and business owners will gather for the first creditors’ meeting in Canberra on Tuesday, but few hold hopes of seeing their money again.

”It is possible that there is a small amount of equity in various vehicle and equipment leases but it will be immaterial to the overall liquidation,” Mr Sanderson said.

”We have not become aware of any undisclosed assets at this stage.”

A report would be given to the Australian Securities and Investments Commission following the meeting, Mr Sanderson said.

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Homeowners, contractors in limbo as ACT Homes goes into liquidation.

May 8th, 2014

Sydney liquidation company Dissolve was appointed to wind up the company on Wednesday afternoon.

Owner Cliff Sanderson said ACT Homes principal David Geilen told him five homes that were under construction would need to be left unfinished, and 50 workers or businesses were owed money.
”[Mr Geilen] tells us he only had a couple of employees and they had been notified their employment had been terminated early in the week,” Mr Sanderson said.

Liquidators had not yet received the company’s paperwork but planned to issue a creditor’s report in coming weeks.

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Your business might be on this ASIC database, and you don’t even know it

September 19th, 2013

Dissolve liquidator Cliff Sanderson says the introduction of the PPSR has been problematic, as many businesses still don’t realise it exists.

“What it was supposed to do was help unsecured creditors who wanted to register for retention of titles,” he says. “But the big problem is you register once, and leave it there forever.”

The collapse of a guitar store last year brought the practicalities of the register into focus. The company sold rare guitars hand-crafted by individuals, but none of them had registered their assets under the new register – essentially leaving their ownership in question.

While the owners had their guitars returned, the incident revealed how many businesses still don’t know about the register at all.

Sanderson says the transition has been less than ideal – and there are still problems with the current register.

“As a user of the ASIC Charges Register in the past, it was very easy to go and see who had a charge over a company, and you could do that very quickly and easily.

“But with the new PPSR, there is quite a lot of stuff listed, and quite a lot that isn’t. It’s a crowded register … and that extra information isn’t necessarily useful.”

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Bon Aroma closure: staff left out of pocket

August 29th, 2013

Liquidator Cliff Sanderson met with several ex-employees on Tuesday at a creditors’ meeting.

While a full investigation into the company’s financial affairs is yet to be conducted, Mr Sanderson said it was likely unpaid staff entitlements would be “higher” than the $17,000 originally flagged.

The company also owes $419,000 to the tax department and $1500 to Origin Energy and Telstra.

Mr Sanderson said it was “too early to tell” if there would be any return to creditors.

The liquidators’ investigation could take up to two months.

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Fewer businesses trading at a loss, latest ATO stats reveal

May 7th, 2013

But Dissolve liquidator Cliff Sanderson says the figures aren’t contradictory, especially as they tend to lag from when the pain first started.

Sanderson says for businesses in the 2010-11 year, they may have started feeling financial trouble as early as 2007 or 2008, when the global financial crisis first started.

“Insolvency numbers show a lag from when companies get into financial difficulty,” he says. “There was a bad year in 2008, so there was clearly a delay there.”

“The figures are driven by small companies, and when an economy hits significant amounts of trouble, the first cards to fall are usually the smaller businesses.”

Micro-businesses, which the ATO states have incomes between $1 and $2 million, make up the vast majority of businesses. The number of micro businesses increased from 257,994 in 2009-10 to 274,022 in 2010-11 – representing 77.4% of all companies.

Sanderson says given the number of insolvency appointments still being recorded, the trend could continue.

“When a company gets into trouble, the last thing they want to do is put the business in liquidation. They fight until the bitter end, and that can take years.”

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ASIC warns number of faulty liquidators’ reports is on the rise

May 2nd, 2013

Insolvency expert and liquidator at Dissolve Cliff Sanderson told SmartCompany many of the issues would have been to do with filling out the forms, but said the number of inadequate declarations was still too high.

“More than half is too many so work can be done in this area,” he says.

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Insolvency costs tipped to spike following growing securities registry entries

April 30th, 2013

Cliff Sanderson, an insolvency expert and company liquidator at Dissolve, said the register provided protection to suppliers.

However, he said he was concerned there was no requirement to remove entries from the register over time, meaning the entries in it would become less relevant. Just over 300,000 entries were removed from the register in the March quarter, but Sanderson says there’s no requirement to do this.

“Every time we get [an insolvency job], there is a raft of registrations on the PPSR. Before selling the assets, you’ve got to work through those registrations to see whether anyone else has rights to them. At the moment, it’s not a huge problem. Not everyone is registered yet.

“My concern is, 10 years from now, how am I going to do my job? There’s no requirement for anyone to delete a registration when they no longer own an asset.”

“It’s going to increase the cost of insolvencies, and we already cop a lot of flak for the high costs of insolvencies.”

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ASIC warns cooperation pays for small business

April 10th, 2013

The corporate watchdog has released a report today in which it argues new statistics show a growing number of targets are cooperating as part of the organisation’s new approach to prosecutions among liquidators, company directors and accountants.

But one industry figure, insolvency advisory firm Dissolve chief executive Cliff Sanderson, says smaller businesses have very little choice when it comes to cooperating with the Australian Securities and Investments Commission.

“Most of the enforceable undertakings for liquidators would be called ‘undeniable breaches’, and are to do with specific provable things, like failure to lodge accounts or payments,” he says.

“These are factual things, and if you didn’t do them, it’s clear.”

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Insolvency’s undertakers feel the heat from corporate collapses

April 3rd, 2013

At first glance it’s an ugly set of numbers. The latest data on corporate collapses showed a new record was set in January. But insolvency practitioners are bracing for a difficult year.

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Insolvency practitioners call for crack down on phoenix companies, but it’s not so simple

March 26th, 2013

The insolvency industry has warned more needs to be done to police the growing problem of phoenix companies and the practitioners who profit from setting up such dodgy deals, although at least one expert says the reality isn’t so simple.

While phoenix companies, in which directors place a company in liquidation in order to avoid paying tax and then continue to trade, do occur, one expert says they’re still not defined at all.

Cliff Sanderson of Dissolve told SmartCompany there are still “no phoenix company laws”.

“There was some legislation last year which made directors potentially liable for PAYG and tax returns, but there’s nothing specifically there about phoenix operations.”

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