Jones Partner

Investing Your Life Savings – Be careful of Ponzi Schemes

18/03/2021 by Bruce Gleeson

On 15th December 2020 Daniel Soire and myself were appointed Provisional Liquidators of Maliver Pty Ltd and Receivers to the property of Melissa Caddick by the Federal Court of Australia pursuant to an application by ASIC. The Caddick case continues to attract significant interest, particularly given the recent announcement by NSW Police that they have found certain body parts of Ms Caddick on the NSW South Coast.  The cause of her death has not as yet been determined. Relevantly, it also an important reminder of the continuing existence of “Ponzi Schemes”. What is a Ponzi Scheme? And where did the name come from? Wikipedia indicates that a Ponzi Scheme is a form of fraud that l

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Insolvency Reforms to Support Small Business – Will You Be Eligible?

18/11/2020 by Bruce Gleeson

The Federal Government announced reforms in October 2020 aimed at assisting small business to restructure when they are in financial distress, which has been particularly evident during the Covid 19 pandemic. The reforms have been designed to reduce the complexity and costs of the small business in restructuring their financial affairs with a view to continuing into the future when compared to the present option available, that being a Voluntary Administration (“VA”) process. In what some industry participants are calling a VA light process and likely to be available from 1 January 2021, after all the temporary relief measures regarding insolvent trading and pursuit of debts end, the

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Temporary Relief for Directors Personal Liability for Trading Whilst Insolvent

07/10/2020 by Bruce Gleeson

Readers may possibly recall that the Federal Government announced a raft of temporary relief measures in late March 2020, some of which were aimed at giving directors of companies’ confidence to trade through Covid-19. One such important measure was that directors would be temporarily relieved of their duty to prevent insolvent trading with respect to any debts incurred in the ordinary course of the company’s business. As such, this served to relieve the director of personal liability that would otherwise be associated with insolvent trading. The initial relief period was 6 months. In late September 2020 this relief period was further extended until 31 December 2020. What does not

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Temporary Relief Measures for Financially Distressed Businesses Extended – Proceed with Caution

09/09/2020 by Bruce Gleeson

The Federal Government announced on 7 September 2020 a further extension to 31 December 2020 of temporary relief measures that were previously set to expire on 24 September 2020. Curiously, such measures were announced within 24 hours after the Victorian Premier extended the stage 4 lockdown timeline until 26 October 2020. But where does this leave businesses at the end of it? There are differing views. Whilst moratoriums provide much needed breathing space for businesses, debt nonetheless continues to accumulate. Therefore, does this ultimately leave businesses in a better position? It is a finely balanced argument, because a period of time was needed for the Governments to respond to t

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Why strong emotional cashflow is critical for success

21/07/2020 by Bruce Gleeson

Covid 19 was first confirmed in late January 2020. Subsequently on 20 March 2020 restrictions such as the closing of our borders and social distancing were introduced. Since these restrictions were introduced, I have read and listened to webinars regarding the importance of cashflow for a business and household during and coming out of the pandemic. OK – but what about emotional cashflow? What is your current level of emotional cashflow? Why is it important for small to medium enterprises (“SME’s”) and households? Firstly, let’s not discount the concept of cashflow itself. Cashflow relates to the increase or decrease in the amount of money a business or household has. The old a

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Beware of Zombie Companies Post Covid-19

21/05/2020 by Bruce Gleeson

By Bruce Gleeson, FCA FCPA RITF Director – Jones Partners Insolvency & Business Recovery The proliferation of zombie companies pre Covid-19 has largely been fuelled by reduced financial pressure. Examples being financial institutions continuing to offer (or not otherwise call in) finance to non-viable companies and also the impact of lower interest rates particularly post the global financial crisis (“GFC”). During the Covid-19 pandemic these zombie companies have been allowed to gather further momentum and the damage that this is likely to cause post Covid-19 presents a real and present danger for those that are transacting with them. What is a zombie company? Wikiped

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Directors Personally Liable for GST

30/01/2020 by Bruce Gleeson

By Bruce Gleeson, FCA FCPA RITF Director – Jones Partners Insolvency & Business Recovery Directors can already be held personally liable for Pay-As-You-Go [“PAYG”] and Superannuation Guarantee Charge [“SGC”] liabilities of a company in certain circumstances via the Director Penalty Notice [“DPN”] regime. 2020 is very likely to see legislation passed in the Senate to extend the DPN regime to include personal liability for GST as well. Why has this occurred? The Federal Government has been continuing to monitor the extent to which unpaid taxes, in particular GST (which commenced in 2000) are prevalent in illegal phoenix activity and also more generally the insolv

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Bankruptcy & Financial Rehabilitation of Individuals

16/10/2019 by Bruce Gleeson

By Bruce Gleeson, FCA FCPA RITF Director – Jones Partners Insolvency & Business Recovery Bankruptcy is a concept that is frequently misunderstood, particularly given that in Australia it relates to the affairs of an individual as opposed to a company (noting in America the term is used for both). It can also conjure up in an uninformed individual’s mind a range of emotions – many of which are incorrect. Findings from a recent and detailed study of bankruptcy in Australia present some useful information. Importantly, as I wrote in my last article voluntary bankruptcy should always be considered as a last resort option after consideration of other possibilities have been evaluated

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It doesn’t need to always end in bankruptcy?

19/08/2019 by Bruce Gleeson

Over the twenty-five (25) years that I have been advising individuals who have been in some form of financial difficulty, I believe between 15-20% of those bankruptcies to which I have been appointed could have been avoided if the individual had talked about their money problems early on with a qualified professional and put in place the right strategy to deal with their debts. So what should you do if you have money problems? Bankruptcy should always be viewed as a last resort option after consideration of other possibilities have been evaluated and are deemed not viable or achievable. Declaring voluntary bankruptcy is not an easy decision for the individual in my experience and brings wit

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Australian bankruptcy numbers at a 24-year low. Credit card lending at an 8-year low. Is this good news?

14/08/2019 by Bruce Gleeson

Before we crack open the champagne, we need to put these statistics into perspective rather than looking at them in isolation – specifically let’s look at what appears to have been happening in the economy over the past few years to get a deeper sense of what might be in store down the track and what households and business owners should focus on. According to March 2019 data, the annual inflation rate is running at 1.3% – well below the RBA target range of 2-3%. Also, with approximately 60% of our economic growth dependent on household spending, there is little doubt that any pullback by households is going to have an impact on economic growth and therefore inflation which in

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