Descon Group Australia liquidator queries deposits paid for luxury sports cars, missing equipment

Debts of failed national builder Descon Group have soared towards $400 million making it an unenviable contender for the largest construction group collapse in Australia’s history. Now a liquidator has revealed where some of the money may have gone

Debts of failed national builder Descon Group have soared towards $400 million making it an unenviable contender for the largest construction group collapse in Australia’s history.

The liquidator of parent company Descon Group Australia has found it owed more than $72 million and had spent hundreds of thousands of dollars on deposits for luxury sports cars which were not listed among its assets.

More than 10 companies in the Descon and Adcon groups are in administration or liquidation, with their combined reported debts topping $390 million – eclipsing the $250 million Probuild collapse in 2022 and the $169 million failure of PBS Building in 2023.

Terry Rose of SV Partners said he’d reported sole director Danny Isaac, who has been living in Dubai since last October, to ASIC for seven potential offences, including insolvent trading and failing to provide a complete report of company affairs “despite multiple follow-ups”.

A lack of financial records has been bemoaned by multiple administrators of the group’s companies, which have reported numerous related-party loans meaning some of the debts may be under or over-stated.

Descon Group Australia director Danny Isaac.

The books and records of the company have also not been provided and the whereabouts of $88 million of plant and equipment previously owned by the company is unknown.

Mr Rose said the company had spent $403,300 in December 2021 and January 2022 on deposits for a Lamborghini Aventador and a Bentley Flying Spur which were not owned by the company.

His report said preliminary investigations indicated Mr Isaac “may have used company funds to pay for personal use assets (among other things)” and that he’d found almost $82 million in “unfair preference, related party unfair preference and unreasonable director-related transactions”.

The lengthy list of creditors includes unrelated major builder, ADCO Constructions, which is owed more than $18.3 million.

A deposit for a Lamborghini Aventador was paid for with company money.

Descon also paid a deposit for a Bentley Flying Spur.

Mr Rose named 48 companies which had been directed by Mr Isaac, who is facing current bankruptcy proceedings in the Federal Court, in the past two years.

As subcontractors, lenders and staff struggled under the weight of hundreds of millions in debt owed by Descon Group Australia and its companies, it was earlier revealed the group’s boss had been splashing cash on first-class global flights.

As revealed by the Gold Coast Bulletin, Mr Isaac had previously operated companies in Western Australia under the name Sami Adib before moving to Queensland and founding the Descon group while still an undischarged bankrupt.

Questions remain over how he was able to become a director of scores of companies, obtain builder licences in three states and obtain billions of dollars in finance before his bankruptcy was eventually discharged.

Meanwhile, trade subcontractors and suppliers are out of pocket by more than $22 million by Descon’s parent company alone and projects commenced by Descon remain stalled.

Subbies United founder John Goddard said the combined debts of the group meant it was “probably the biggest ever” building group failure.

“That is devastating for everyone, that’s a huge amount of money out of the industry,” he said.

“It’s a shocking amount, it’s hard to fathom.”

Mr Goddard said Queensland subcontractors would have lost “millions more” without constant reporting of the matter by the Gold Coast Bulletin.

More than 60 buyers in the Waverley Residences at Southport are in limbo after waiting more than two years for settlement and hearing nothing about whether they will ever take possession of the nearly-completed apartments.

The project’s developer Busikon is also directed by Mr Isaac, who is a 50 per cent shareholder with former car salesman Mark Kebblewhite, also the company’s secretary.

Receivers for the project’s financier have told buyers Busikon was also “potentially insolvent”.

No action has been taken against Mr Isaac or Mr Kebblewhite by ASIC and no criminal charges have been laid.

The Bulletin has contacted the receivers for comment.

Originally published as Descon Group Australia liquidator queries deposits paid for luxury sports cars, missing equipment