Reports Storm Financial founders knew of debt dilemma
Allegations have reportedly been made in the Queensland Supreme Court that the founders of Storm Financial knew the company was trading while insolvent when they paid themselves a $2 million dividend late last year.
A Brisbane news article reports that court documents show Storm Financial’s co-founders, Emmanuel and Julie Cassimatis, knew the company was heavily in debt when they accepted a $2 million payment.
According to the article, the court documents allege the couple prepared cash flow statements on December 15, 2008, that showed they couldn’t meet their debt commitments. This was then confirmed by professional advisers.
The article quotes an affidavit filed by KordaMentha in the Supreme Court last week. It quotes the legal documents in saying the payment “appears to have been made on the basis that is inconsistent” with a resolution of directors on November 5, 2007, to make the payment from the proceeds of the company’s public float — a listing that never eventuated.
The documents reportedly consist of an affidavit filed by KordaMentha, the company appointed by the Commonwealth Bank of Australia as receivers of Storm Financial. The article states KordaMentha alleges it may have “an action for breach of duty against the directors” based on the fact that “it’s possible that they knew or should have known the company was insolvent or likely to become insolvent” at the time the $2 million payment was made.
The article states the Cassimatis’ deny this claim.
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