HMW Accounting faces allegations in court from ex-staff about ‘corrupt and dishonest’ practices

Allegations of corruption and dishonesty have emerged in a protracted legal battle between two Brisbane accounting firms who have been locked in a court battle almost two years.

STARTLING allegations of wrongdoing have surfaced in what is an otherwise ordinary restraint-of-trade dispute which has been playing out in Queensland’s Supreme Court for nearly two years.

Brisbane-based HMW Accounting & Financial Group sued two of its former employees in March 2018 to enforce the restraint and confidentiality parts of their employment contracts.

That followed the move by the ex-staffers, Craig McPherson and James Hoeft, to strike out on their own and launch a competing accounting outfit, MH Private Pty Ltd, in the city in early 2017.

Their website, featuring a homepage with a crazed gent holding a banana like a handgun, describes the firm as “not your average accountants’’. Indeed!

Anyway, McPherson and Hoeft maintain no enforceable contracts were in place with HMW, which is controlled by business partners Angelo Catalano, James Whitelaw and Grant Williams.

But, in a key point, they argue that, even if enforceable contracts were in place, HMW violated “certain implied terms’’ of those agreements.

Specifically, they allege HMW breached the expectation that it “would not operate its business unlawfully’’ or contrary to industry standards, codes of ethics and good faith.

McPherson and Hoeft even went so far as to allege in court documents that HMW was a “corrupt and dishonest’’ business.

While the pair have removed that phrase in their amended defence, they still describe what they allege is a tax avoidance or minimisation scheme by Catalano which they claim violated ethical standards.

“Catalano held an investment through his parents’ self managed superannuation fund, which he controlled, for the purpose of avoiding and/or minimising tax,’’ they allege in court papers.

HMW recently lodged an application to strike out the “implied terms’’ of the amended defence but it was dismissed by Judge Soraya Ryan, leaving the allegations to be fully tested at trial.

Catalano and his crew would not comment this week but, instead, redirected us to their solicitor, Liam McMahon.

“HMW Group denies the allegations made by Mr Hoeft and Mr McPherson – they have no basis in fact or law. Documents have been filed with the Supreme Court of Queensland setting out HMW’s response to these unfounded allegations,’’ McMahon said.

McPherson and Hoeft, through their solicitors, declined to comment on the case.

EYEBROWS RAISED

It’s not the first time that HMW has managed to raise a few eyebrows.

Lyndon Kingston.

Last year they hired Lyndon Kingston, the disgraced former boss of the Bananacoast Community Credit Union. He even featured prominently on their website.

After nearly a decade in the credit union job, Kingston was fired for “serious misconduct’’ in late 2017.

The lender later alleged in court documents that he oversaw a multimillion-dollar scam to improperly enrich himself through sham payments, kickbacks and bogus expense claims.

ASIC announced in December that it had charged Kingston with three counts of dishonest use of his position as a director and two counts of providing false information.

He has also been charged with two counts of making a false document, each of which carries a maximum sentence of 10 years behind bars.

Not surprisingly, Kingston no longer works at HMW and his image has been scrubbed from the firm’s website. There is no suggestion of wrongdoing by Kingston while he was at HMW.

REWARDING BUSINESS

Wealthy investor Andrew Banks, the former Shark Tank star, has nearly hit the $400,000 crowd-funding target for his innovative rewards business Plastiq.

Under the scheme launched last year, consumers making either in-store or online purchases automatically get cash back from participating merchants without the need for loyalty cards, merchant integration or receipts.

Former Shark Tank star Andrew Banks

It has already attracted more than 2500 members and about 500 retailers, including the likes of Woolworths and Caltex, which pay a commission to Plastiq for connecting with customers and gaining valuable marketing data.

The aim now is to grow membership to 150,000 by the end of the year and expand overseas. The US, UK and New Zealand have all been flagged as possible target markets.