Bankrupt businessman John Webb and his wife Denise benefited from payments of almost $200,000 from expo company Media & Events Australia Pty Ltd during the year before it collapsed owing as much as $866,730, an administrator’s report claims.
The payments are listed among potentially uncommercial transactions detailed by administrators Brian McMaster and Jack James of KordaMentha before they sought to be removed from the role by the WA Supreme Court on Tuesday.
The transactions include a $67,000 gift to Mrs Webb by Greg Millar, the company’s sole director during the period reviewed.
However, Mr Webb and Mr Millar challenged the accuracy of the report, claiming they would be seeking legal advice on the matter.
Mr Millar said he lent money to Mrs Webb to help her pay out a business-linked mortgage.
The administrators’ report states that Media & Events’ management was poor and record keeping was inadequate, something Mr Millar denies. The report also reveals that the company is under investigation by the Australian Securities and Investments Commission.
Based on information obtained from Mrs Webb on Friday, Mr McMaster and Mr James looked at transactions involving her, Mr Webb and Mr Millar. They “identified several tranches of payments that we consider constitute uncommercial transactions”.
In the course of that investigation, they also tracked $10,000 back to payments they had received through their work on a related company, Consolidated Business Media Pty Ltd, a predecessor to Media & Events in the expo business operations of businessmen Mr Webb and Mr Millar. The two companies between them have left a trail of creditors amounting to millions of dollars – including the Australian Taxation Office, which is owed $346,727 by Media & Events.
Last year, Mrs Webb appointed Mr McMaster and Mr James as receivers and managers to CBM.
That $10,000 was enough for the administrators to conclude they had a potential conflict and seek an end to their role. Ian Francis and Michael Ryan of Taylor Woodings took over on Tuesday.
Before their departure, the KordaMentha pair wrote the report that identifies the failure to maintain accounting records and poor management as two key causes of the collapse of Media & Events, recently renamed ACN 079 908 768 Pty Ltd. They also believe that taking on liabilities from CBM was a major issue.
The report reveals that Media & Events director Mr Millar attributes “the company’s cash flow difficulties to the failure of several large expos in April and May 2005”.
