Insolvency firm's fraud claims hit court as industry faces overhaul
The case comes as the Gillard government released draft laws on Wednesday to overhaul the insolvency industry, including giving greater powers to creditors to remove liquidators and curb excessive fees.
Parliamentary secretary to the Treasurer Bernie Ripoll said in a statement: "The Gillard government is committed to restoring the community's confidence in the effective regulation, high professional standards, transparency and accountability of the insolvency profession following recent high-profile cases of misconduct by corporate insolvency practitioners."
Mr Crisp, a veteran insolvency practitioner whose list of appointments runs to 11 pages, has worked on jobs including Mick Gatto's Elite Dogman & Riggers, which failed in February owing the Australian Tax Office $3 million, and trucking company Viking Group, which collapsed last year amid allegations of fraud.
Mr Crisp, who now works for rival firm Jirsch Sutherland, denies the allegations, which relate to the liquidation of Foodlife Inventory Holdings between 2002 and 2008.
In a statement, his legal team said the allegations of fraud against him were not properly pleaded, he had provided all information about Foodlife to RSM and the firm had released him from any liability in a deed signed when he left in August.
BusinessDay is able to reveal details of the case after the Chief Justice of the Victorian Supreme Court, Marilyn Warren, threw out Mr Crisp's attempt to obtain a suppression order.
Justice Warren also denied a bid to force Fairfax Media to reveal its source, saying the application "contains an element of fishing", and awarded costs against Mr Crisp.
She said there was "a public interest" in reporting on Mr Crisp because, as an official liquidator, he acts as an officer of the court when he accepts appointments from the courts.
Mr Crisp is liquidator of Viking Group, which collapsed last year amid allegations that invoices had been falsified and luxury cars had gone missing.
The Herald Sun reported in August that it had "seen" emails to RSM Bird Cameron in which "claims were made that Hells Angel bikies illegally took trucks and other equipment on behalf of RSM Bird Cameron". RSM Bird Cameron has denied using Hells Angels to repossess goods and continues as liquidator of the Viking Group companies.
Mr Crisp was also appointed liquidator of Mick Gatto's company Elite Dogman & Riggers in February. That job remains with RSM.
RSM filed a writ on November 8, 2012, and a statement of claim eight days later. On the same day RSM filed the writ, its 80 partners slapped a caveat on Mr Crisp's property in Windsor Drive, Lysterfield.
The statement of claim alleges that as liquidator of Foodlife, Mr Crisp billed $2.1 million but failed to pass all the fees through to RSM, leaving a "shortfall amount" of $514,313.
Between September 8, 2004, and June 23, 2006, RSM alleges Mr Crisp made 70 payments from an account to his personal bank account to meet debts which he owed creditors.
It itemises payments to companies including Artistic Pools, A&R Building Constructions, Coolabah Landscapes and Valley Motor Group. Some of money was allegedly spent on property renovations at the Windsor Drive property.
RSM is seeking damages, an account of profits made by Mr Crisp in breach of his fiduciary duty, an order that any profits or benefits are held on trust for RSM, an order that Mr Crisp holds his interest in the Lysterfield property on trust for his former employer, and costs.
The insolvency industry has been the subject of a Senate inquiry after the government was pressured to review the sector and the role of the regulator, Australian Securities and Investments Commission, in its regulation of the industry. Liquidators have been called "cowboys", "bottom feeders" and "vultures", and have faced criticisms ranging from excessive fees, over-servicing, protracted settlements and lack of transparency, to conflicts of interest.
The Senate inquiry, which began in November 2009, has uncovered repeated complaints about the insolvency industry.
Frequently Asked Questions about this Article…
RSM Bird Cameron has launched legal action against former partner Glenn Anthony Crisp, alleging he committed fraud and misappropriated more than $500,000 during the long-running liquidation of Foodlife Inventory Holdings (2002–2008). The claim says Crisp billed $2.1 million but failed to pass through fees to RSM, leaving a shortfall of about $514,313, and that payments were made from an account to his personal bank account and spent on items including property renovations.
Glenn Anthony Crisp is a veteran insolvency practitioner with a long list of appointments. The statement of claim alleges he made 70 payments from a liquidation account to his personal bank account between 2004 and 2006, used some money for renovations at a Lysterfield property and failed to pass all fees to RSM in the Foodlife liquidation. Crisp denies the allegations, says he provided information to RSM, and says RSM released him from liability in a deed when he left the firm.
High‑profile claims can undermine investor confidence in how insolvencies and liquidations are handled. The article highlights concerns about excessive fees, conflicts of interest and lack of transparency in the insolvency industry — issues that can influence creditor recoveries and the public trust that affects investors and creditors generally.
The Gillard government released draft laws aimed at overhauling the insolvency industry, including giving greater powers to creditors to remove liquidators and measures to curb excessive fees. Parliamentary secretary Bernie Ripoll said the reforms sought to restore confidence by improving regulation, professional standards, transparency and accountability.
A Senate inquiry that began in November 2009 has uncovered repeated complaints about the insolvency industry. The inquiry, along with pressure to review the sector, has led to scrutiny of the role of the Australian Securities and Investments Commission (ASIC) in regulating liquidators. Complaints reported to the inquiry include excessive fees, over‑servicing, protracted settlements and conflicts of interest.
Yes. The article notes Crisp worked on appointments including Elite Dogman & Riggers (associated with Mick Gatto), which failed owing the ATO about $3 million, and the Viking Group, which collapsed amid allegations that invoices were falsified and luxury cars went missing. RSM has denied allegations that it used Hells Angels to repossess goods in the Viking matter.
RSM is seeking damages, an account of profits allegedly made by Crisp in breach of his fiduciary duty, orders that any profits or benefits be held on trust for RSM, an order that Crisp’s interest in the Lysterfield property be held on trust for his former employer, and costs.
Investors should follow developments in the draft laws and the Senate inquiry highlighted in the article — in particular proposals to give creditors more power to remove liquidators and curb excessive fees — and pay attention to reporting on individual liquidator conduct, since transparency and public interest reporting (the article notes a court rejected a suppression bid) are part of the broader push for accountability.
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