Brazilian Beauty founder Francesca Webster chased for $1.2m over insolvent trading
Brazilian Beauty founder Francesca Webster is being chased for almost $1.2m by the liquidators of her failed beauty empire amid claims of insolvent trading.
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Brazilian Beauty founder Francesca Webster is being chased for almost $1.2m by the liquidators of her failed beauty empire amid claims of insolvent trading.
Liquidator Jonathan McLeod has told creditors in a report lodged with ASIC that there were reasonable grounds to believe the company, trading as Brazilian Beauty Stores, was insolvent from at least June 2020 until he was appointed in October last year.
Unsecured creditors of the company are owed approximately $2.5m including more than $900,000 to the Australian Taxation Office.
“We believe the director (Ms Webster) had reasonable grounds for suspecting that the company was insolvent and that she failed to prevent the company from incurring further debts,” Mr McLeod said in the report.
He said a letter of demand had been sent to Ms Webster seeking payment of $1.19m but no response had yet been received.
The report said that by December 2019 the company had incurred losses for two successive quarters and was unable to recoup those losses. By December 2020, the company also had accrued substantial liabilities to the Australian Taxation Office (ATO).
Liquidators also are chasing Brazilian Beauty Stores for $111,383 after assets were transferred for a zero sale price to a company, Brazilian Beauty Clinics, of which Ms Webster’s daughter Alexandra Ramsay is the director.
The sale included nine Brazilian Beauty clinics around the city, including stock, fixtures and fittings.
Mr McLeod said in the report that he believed the transfer was an “uncommercial transaction” that did not benefit creditors.
“We do not consider that a reasonable person in the company’s circumstances would have entered into the agreement … given the transfer was to the detriment of creditors of the company and there was no basis in the ordinary course of business for the company to transfer the branded salons to a related entity,” Mr McLeod wrote in the report.
English-born Ms Webster opened her first Brazilian Beauty salon in New Farm in 2004, expanding to 20 stores over the following decade with ambitions to open 50 around the country.
Along the way she picked up several gongs including a finalist in the 2014 Telstra Business Women’s Awards.
Webster’s Facebook and Instagram postings show her enjoying a holiday in Barcelona and her native United Kingdom when her company collapsed last year.
Comment has been sought from Ms Webster.
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