Mr Philip James Bart, Mr Geoffrey Thomas Parker and Mr Ronald George Johnson, the former Chair, Chief Executive Officer and Chief Financial Officer of Bruck Textile Technologies Pty Ltd (Bruck Textile) respectively, have been committed to stand trial on criminal charges.
They were committed for trial following a hearing before the Melbourne Magistrates’ Court on one charge each of preventing the recovery of employee entitlements, contrary to sections 596AB and 1311 of the Corporations Act.
The charges followed an ASIC investigation conducted under the Serious Financial Crime Taskforce (SFCT) into the activities of Bruck Textile. Bruck Textile was placed into liquidation on 11 July 2014 following the sale of the company’s assets to a related entity.
As a result of the liquidation, 58 employees of Bruck Textile lost their employment and their entitlements, including redundancy payments, were unpaid by the company.
It is alleged that Mr Bart, Mr Parker and Mr Johnson agreed to sell the assets of Bruck Textile with an intention to prevent the recovery or significantly reducing the amount of redundancy entitlements of Bruck Textile employees.
Bruck Textile’s former employees applied under the Commonwealth Fair Entitlements Guarantee scheme for the payment of their entitlements after the liquidators found that the company did not have sufficient assets to meet them. Under this scheme, the Commonwealth advanced over $3.485 million towards paying Bruck Textile’s outstanding employee entitlements.
A trial date for Mr Bart, Mr Parker and Mr Johnson in the County Court of Victoria is to be fixed.
The Commonwealth Director of Public Prosecutions is prosecuting the matter.
Background
Bruck Textile Technologies Pty Ltd, incorporated on 29 May 1996, was a company based in Wangaratta, Victoria engaged in textile manufacture.
At the time of the alleged offending, the maximum penalty for a criminal breach of section 596AB of the Corporations Act was $170,000 or imprisonment for ten years, or both.
ASIC’s investigation was assisted by the receipt of a report prepared by Bruck Textile’s liquidators. The liquidators’ investigation and report was funded by the Assetless Administration Fund.
The SFCT is an ATO-led joint agency taskforce that brings together the knowledge, resources and experience of relevant law enforcement and regulatory agencies to identify and address the most serious and complex forms of financial crime.
The Serious Financial Crime Taskforce (SFCT) started operation on 1 July 2015.
From this date until 31 March 2023, the Taskforce has progressed cases that have resulted in:
- completion of 1,770 audits and reviews
- conviction and sentencing of 21 people
- raised liabilities of $1.647 billion
- collected $652 million.
For more information on the SFCT, including the identikit outlining key financial crime personas, visit ato.gov.au/SFCT.
