Jail Time for Building Company Directors Convicted of Grande Scale Theft

Fighting for Subbies Rights

We have a name for the crime against subbies and suppliers when a builder liquidates his company. Its called "Grande Scale Theft" or "Debt Wash".

There is always fraud which includes;

• False Statutory Declarations
• False financials submitted to QBCC to meet Minimum Financial Requirements (MFR)
• Insolvent trading
• Liquidate to "debt wash" or wash away the debt owed to subbies
• All of the above and more including using payments due to subcontractors to build their own homes or units.

One of the perps of a recent debt wash was so brazen he decided to rub his creditors noses in it by using the name "Phoenix" in his new company.

He thought that was really funny and oh so clever but what he did was put a target on his back. He is soon to face a public examination. Good luck smart arse, you will need it.

Since 2013 there have been dozens of building company directors liquidate their companies with 50 major liquidations costing over 9000 Queensland subcontractors half a billion dollars in losses.

Liquidation = Debt washed away.

If the law did its job and put even 1 of those directors in Jail, I am sure liquidating building companies would immediately become less frequent.

If we as individuals defrauded people on even a small scale, we would be investigated and jailed in no time at all.

That’s why it’s astonishing that not even one director of all those liquidated companies has seen the inside of a court room, let alone the inside of a jail cell.

It has become so easy and prevalent, the worst of these scabs have liquidated 3 and even 4 times using wives, son’s and friends to carry out their crimes.

The reluctance of the Police or ASIC to investigate fraud when hard evidence is presented to them is deeply disappointing and that disappointment is shared by thousands of subcontractors, suppliers, their families and their staff who have lost a conservative half a billion in those 5 years.

To date no one has been held to account.

When evidence is presented to The Qld Police they say refer it to ASIC. Then its referred to ASIC who sweep it under the carpet when they send a brief note back saying “no further action will be taken at this time”.

No reasons are given but we know the reasons, ASIC are lazy, slovenly, utterly gutless and contemptible when it comes to doing their job. Their excuse of being underfunded is often bandied about but thats  a cop out. The banking Royal Commission is testament to just how bad they are as is their inaction on share market manipulation.

ASIC have almost incestuous relationships with bankers and others involved in these frauds.

The directors of these liquidating building companies are told by their pre insolvency advisors that there will be no action taken so they know they can perpetrate this fraud with impunity time and time again.

Some of them have it down to an art form even to the point where they buy off their biggest creditors with units or other means in their beautiful unit complexes completed by you with your money, blood sweat and tears.

They do this so there is no chance of creditors ousting their appointed liquidator who they know in most cases will turn a blind eye to the fraud and concentrate on the massive income from preference claw backs. The liquidator may not have the numbers with proxy votes but they will have the dollar value so they win on a count back and stay in the job.

It doesn’t matter what the majority of creditors want, its of no consequence to the leeches.

They know that their appointed liquidators will fight to the death to retain the job as there are massive financial rewards on offer with preferential payment claims from the ATO, subbies and suppliers.

A liquidated builder is a gold mine for liquidators and lawyers. Half the law firms in Queensland would fold tomorrow if building liquidations stopped today.

What Caused the Acceleration of Building Industry Fraud?

As long as we have been around this has happened but in 2014 when the Newman Government attempted to cut red tape for Minimum Financial Requirement’s, they over cooked it in the building industry and opened the flood gates.

They lowered the bar by doing away with the need for an “independent audit” of a licence holders financials. Any accountant could advise and sign off on financials so all sorts of things could be included or omitted from financials to make them look good and meet the MFR’s.

As a result the thieves offering pre insolvency advice for builders in trouble saw opportunity and the thieves who posed as builders took the opportunity presented to them and ran with the ball and creditors money.

How do we fix it?

In the short term, a Police Task Force needs to be set up to investigate building industry fraud followed by Jail time for convicted directors. That will bring the pre insolvency fraud industry to a grinding halt or at worst, slow down the proliferation of the hall of shame that are liquidated builders.

Legislative changes are a long term answer but you only have to look at the Qld State Governments Building Industry Fairness Act 2017 (Security of Payment) featuring Project Bank Accounts to see how slow that process is. It's still in limbo.

We have done an exercise to show just how easy it is to steal subbies money. We have two lists, one of people from all walks of life charged and convicted of fraud and another list of building company directors charged and convicted of fraud.

List of people charged and or convicted of fraud from many walks of life:

1. Man Charged with 1 Million Company Fraud
2. Man Charged with Commonwealth Fraud Offences
3. ATO fraud: Another man arrested, charged over alleged $165m tax conspiracy
4. NSW Police dismantle online banking fraud ring
5. Port Lincoln Man charged with fraud offences
6. Infamous Prison escapee facing return to jail..
7. Purdy McGee - Welfare Fraud

Above is just a small sample of an endless list that keeps lawyers fat and happy and courts to the point of overflowing.

Take the last case there, on 18 June 2018, 35-year-old Purdy McGee was given an effective sentence of 2 years' imprisonment in the Brisbane District Court, after pleading guilty to receiving $89,238.88 in Centrelink benefits to which she was not entitled.

So based on that, how many years jail should a builder who defrauded subcontractors and suppliers of 45 million, be sentenced to?

Simple, just divide $89,238.88 into 45 million and multiply be 2 for the 2 years poor old Purdy got for her miserably small (by comparison) theft of 89k.

The answer is 1008.52 years without being able to comfortably and without fear, bend over in the shower.

There are literally thousands of people charged and convicted of fraud each year so I have done a search to find that elusive building company director among them all.

List of liquidated building company directors responsible for the Gold Rush of half a billion of creditors money who have been charged  and or  convicted of fraud:

1. ...
2. ...
3. ...
4. ...
5. ...
6. ...
7. SFA, we are still waiting.............

Annual builder liquidations by number below - names have been omitted for legal reasons.

Mainly because many of them are litigious scum, I don't want to be sued with my own money they ripped off from me.

2014 Financial Year;

• 3 companies

2015 FY;

• 4 companies

2017 FY:

• 13 companies

2018 FY;

• 15 companies

2019 FY;

• 16 companies

Where do we stop?

If those able to investigate want to stem the flow of the largest unpunished theft in Australian history, all they have to do is investigate, compile evidence, charge and convict one director of fraud and the rest will think twice.
If they do that, a large part of the industry made up of pre insolvency advisors, lawyers and liquidators who live off the theft of our money will be looking for new jobs, perhaps even as builders labourers and don't worry, we will treat you well, a lot better than you have treated us....

We won't stop until there are prosecutions for fraud and the directors are held responsible for this grande scale theft of free money.

No one has been charged despite the massive hall of shame.