Collapsed caravan business owes $3.2m as boss investigated by consumer protection agency

A company which collapsed with millions in debt is now under investigation by a consumer affairs body.

An Australian consumer affairs body is investigating the boss of a collapsed caravan company which owes millions of dollars to creditors but only has three vehicles to repay everyone.

In August, news.com.au reported that Victorian-based Tango Caravans had plunged into liquidation, leaving 60 customers as much as $90,000 out of pocket each after being “sold the fake dream”.

Andrew Yeo and Lindsay Bainbridge of insolvency firm Pitcher Partners, the appointed liquidators, revealed in a statutory report last week that Tango owes $3.2 million to 85 creditors.

Empty-handed customers make up the majority of the unsecured creditors, with the total amount they are owed exceeding $2 million.

And in a major blow to those 60 customers, they have been warned they won’t be receiving any money in the liquidation process.

The report, submitted to ASIC, the corporate regulator, also revealed that Tango Caravans appears to have been operating while it was insolvent since at least March last year.

On top of that, customers’ deposits were used to prop up the business and keep it going, rather than being kept separate and to pay manufacturer’s fees, according to the submission.

“The company’s bank statements confirmed there was no separation between customer deposits and operating funds,” the report stated.

“Customer funds were used for the company’s operating expenses.”

Tango Caravans is being investigated by Consumer Affairs Victoria.

Sarah Horter, the sole director of Tango Caravans, personally guaranteed some of her company’s debts, so those creditors have the ability to bankrupt her, the report noted.

The Melbourne caravan business had racked up a whopping $2.5 million of debt in the last 18 months of its operation when it was believed to have been insolvent.

Liquidators wrote that this could lead to an insolvent trading claim against the director. However, they said it might be “uncommercial” to pursue Ms Horter over this as she does not own any property and would have no means to pay the hefty sum.

Ms Horter is also under investigation from Consumer Affairs Victoria.

The consumer protection agency has made “preliminary inquiries” with the liquidators, according to the report, “and are investigating the affairs of the company and its director independently of my administration”.

In a statement to news.com.au, a Consumer Affairs Victoria spokesperson said that they “take reports that people have paid for products or services that are not delivered very seriously”.

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The Edmunds have lost $73,000.

Tango Caravans had minimal assets and liquidators only recovered three vehicles.

“I have secured three caravans, two of which are owned by the company due to customer trade-ins and one which had been sold to a customer, with the final instalment outstanding,” Mr Yeo wrote in the report.

“These assets are going to be auctioned in due course, and therefore I am withholding the estimated value.”

A small business loan provider called Bizcap had appointed receivers a day after the business went into liquidation in the hopes of recovering an unspecified debt.

But a few days later, the receiver handed control of the company back to liquidators. None of Bizcap’s debt were recovered.

Ali Winter’s family lost $80,000 and was left temporarily homeless.

The Logans are $90,000 in the hole.

News.com.au previously spoke to a former employee and customers left tens of thousands of dollars out of pocket. Chris Ferreira, 37, worked as a sales consultant at Tango for just four months before he was driven to quit as he watched on in horror at the dysfunctional company.

He also discovered he wasn’t paid superannuation for the entirety of the time he worked at the business and is owed around $5000.

We were “sold the fake dream,” he told news.com.au, adding that: “I didn’t realise it was to the extent that it was” until the business finally went bust.

News.com.au previously reported that Tango’s collapse is particularly devastating for Ali Winter and her family-of-five who had been left temporarily homeless in the wake of the company’s failure, as well as losing just shy of $80,000.

Ms Winter, 41, her husband and her three sons, originally from Queensland, sold their home in 2022 to travel around the country in a trip of a lifetime. But wanting an upgrade to their home on wheels, they sold their van to afford a new vehicle from Tango Caravans – and have been waiting ever since.

“We ended up in a short term rental for seven weeks. We’ve been living with all our stuff in the back of a car. We’ll probably apply for a rental,” Ms Winter previously told news.com.au.

Then there’s Sylwia Logan, 43, who’s also in a dire financial position with total losses of $90,000.

The mum-of-two paid $76,000 and on top of that, she took out a loan to be able to afford her dream caravan.

Ms Logan is now paying $14,000 in interest for the five-year loan she took out for a product she will likely never receive.

“I cannot believe I’m going to pay off a loan for something I will never own,” she said.

Tyler Edmunds, a father-of-two, made the full payment to Tango – $73,000 – for his caravan, and he is now facing the prospect of losing it all. Mr Edmunds told news.com.au that everyone feels “ripped off”.

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Originally published as Collapsed caravan business owes $3.2m as boss investigated by consumer protection agency