Former MFS and Octaviar boss Michael Christodoulou King bankrupted over debts

A disgraced former rich lister from the Gold Coast has been declared bankrupt with debts of more than $177m after failing to pay court-imposed fines totalling $300,000.

Disgraced former rich lister Michael King has been declared bankrupt with debts of more than $177m after failing to pay court-imposed fines totalling $300,000.

The ex-CEO of the $2.5bn MFS Group, which failed in 2008 in one of Australia’s biggest-ever corporate collapses, was ordered bankrupt by the federal court on Tuesday.

It was the result of an Australian Securities and Investments Commission (ASIC) presentation of a creditor’s petition regarding his failure to pay a pecuniary penalty order of $300,000.

Co-founder and former MFS CEO Michael King

In the court orders, Justice Kylie Downes said she decided to bankrupt King because:

* The 54-year-old owes provable debts exceeding $177m and there was no evidence to suggest he could pay them, therefore being insolvent.

* There was a “strong public interest” in protecting the public from dealing with an insolvent person.

King’s downfall began during the global financial crisis when MFS, later known as Octaviar, failed.

The Octaviar (formerly MFS) office building on Hicks Street, Southport.

The listed company grew rapidly into a corporate giant with interests in financial services, travel and leisure and childcare before its collapse.

In 2017, King and four other former executives were ordered to pay $615m in compensation to investors for breaches of the Corporations Act owing to MFS’ collapse.

The 217 breaches were committed in relation to misappropriation of $147.5m that had been held by the managed investment scheme known as the Premium Income Fund (PIF) on behalf of unitholders.

In happier times: then-MFS chairman Andrew Peacock (L) and CEO Michael King at the company's 2007 AGM.

In May 2017, the Supreme Court ordered King be disqualified from managing corporations for 20 years, pay the PIF compensation of $177m, pay a pecuniary penalty of $300,000 and a proportion of ASIC’s legal costs.

Although King, who is understood to still live on the Gold Coast, was partially successful on appeal to the Queensland Court of Appeal, that decision was ultimately overturned by the High Court and the trial judge’s orders on penalty were reinstated.

King has never been charged with any criminal wrongdoing.

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