In a manner similar to the collapse of at least seven other companies, the report by Hugh Martin of insolvency specialist firm Bernardi Martin provides new details on a complex and intriguing array of director- and family-related activities that, to date, have amassed liabilities exceeding $14 million.
Furthermore, new information has come to light regarding the money ‘lost’ by the children’s charity, Grow Fit Fund, raising additional questions about possible breaches of director duties, amid other concerns.
The charity was registered with the Australian Securities and Investments Commission (ASIC) and listed two directors, Andy Phanthapangna and Glenn Murray Fuller.
Grow Fit Fund was registered with the Australian Charities and Not-for-profits Commission (ACNC) in February 2021 and had several peculiar connections to the jewellery industry.
Phanthapangna was described as the ‘chairman’ of Grow Fit Fund and was joined on the board by fellow Jewellery Industry Network founding director Laura Moore.
Moore, a former vice president of the Jewellers Association of Australia (JAA), promoted her position with the children’s charity on social media.
While the website of the Adelaide-based charity is still ‘live’ - and which states it was established to “support young and vulnerable children” - the ACNC recently revoked its registration.
With that said, examination of the charity’s financial statements revealed that the directors, and presumably the charity’s board, had approved spending 89 per cent of all income (donations) on payments to Grow Fit Fund staff.
Ultimately, 99.9 per cent of the charity's income was spent on administrative expenses.
Trading while insolvent
Martin’s most recent report on the collapse of Grow Fit Fund has revealed that it was insolvent from the day it commenced. According to the liquidator, this may constitute a breach of director duties for Phanthapangna and Fuller.
As it concerns Moore and the remainder of the charity’s board, the ACNC stipulates that board members “must act with reasonable care, diligence, and honesty in the best interests of the charity.”
The fact that board members, which the government regulator describes as ‘Responsible People’, are typically in honorary positions does not preclude them from proper governance and key duties.
Comments
Post a Comment