Westpoint fallout continues
Two companies affiliated with the embattled Westpoint Group have been served with interim asset freezing orders by the Australian Securities and Investments Commission (ASIC).
Amid concerns that company assets totalling over $4.7 million from Silkchime Pty Ltd and Rold Corporation Pty Ltd would be moved unless action was taken, ASIC made an urgent application to the Federal Court of Australia on Monday August 7 calling for affidavits listing assets and liabilities for both companies.
In relation to Silkchime, ASIC contends that a liability of $3.7 million in loans was transferred from Westpoint to Silkchime between December 2005 and January 2006. Further, it is alleged that recent attempts were made to transfer $30,000 from a Silkchime bank account to one held by Keyworld Investments, a company solely directed by former Westpoint director Norman Carey’s sister, Karen Carey. ASIC also claims that Silkchime’s impending settlement of a property sale would add $400,000 to the net proceeds at its disposal.
ASIC’s concerns regarding Rold relate to a $1 million ‘on-payment’ transaction from Renaissance Mezzanine to Rold on November 25, 2005, a day after Westpoint paid the same amount to Renaissance Mezzanine. It is alleged that these funds were sourced from investor monies, and that the transaction was made in order to reduce Westpoint’s cash assets at a time when it could reasonably be expected that it would soon face some form of external administration or liquidation.
In response to ASIC’s concerns, the Federal Court has ordered the freezing of certain assets held by Silkchime and Rold until August 28, 2006, with a further hearing scheduled for the same day.
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