Liquidators chase Rosewalls

Former BBY executive chairman Glenn Rosewall’s bankruptcy filing hasn’t deterred liquidators of the failed stockbroker.

Former BBY executive chairman Glenn Rosewall. Picture: Renee Nowytarger

Former BBY executive chairman Glenn Rosewall’s bankruptcy filing hasn’t deterred liquidators of the failed stockbroker in their dogged legal pursuit of him or his father, tennis great Ken Rosewall, over loans repaid to them ahead of the collapse of the company.

The Australian has obtained a copy of a debtor’s petition filed last week by Glenn Rosewall.

That debtor’s petition appointed the principal of insolvency firm Farnsworth Shepard Adam Shepard as a trustee.

The developments add another intriguing twist to the demise of stockbroker BBY and the liquidator’s attempts to retrieve funds from directors after the collapse revealed a $20 million shortfall in client accounts.

BBY’s liquidator KPMG, which has initiated court action against the Rosewalls as majority owners and former directors of BBY, is seeking $3.1m from Ficema, a company associated with Ken Rosewall, and more than $2m from a company associated to Glenn Rosewall.

KPMG yesterday said its court action against Glenn Rosewall would continue because it largely related to an associated company and a super fund rather than to the individual.

“We will continue our claim against GARF [a company associated with Glenn Rosewall] to recover the $2.5m it was paid prior to the BBY collapse,” KPMG director of restructuring services Stephen Vaughan said.

The funds that will be disputed in court are related-party loans repaid by BBY to entities associated with Glenn and Ken Rosewall 11 months before the company’s 2015 demise.

KPMG has also commenced legal action against the appointed auditor of BBY, BDO East Coast Partnership.

After longstanding investigations into BBY’s affairs, KPMG believes the company was trading while insolvent since 2011 and found it dipped into clients’ money to meet capital obligations.

Public court examinations into the affairs of BBY also revealed Glenn Rosewall sought advice on running the company from psychic and vibrational healer Nevine Rottinger.

KPMG and the Rosewalls are set to fight the matter in court. A hearing date is yet to be decided.

At a directions hearing yesterday, NSW Supreme Court judge Ashley Black noted Glenn Rosewall’s bankruptcy and allowed more time to determine whether his associated company would be represented in court.

The matter is scheduled to be heard in April.

The entity in question is yet to file a defence against KPMG’s legal action.

Glenn Rosewall did not return calls yesterday seeking comment on the bankruptcy.

Justice Black last month dismissed cross-claims by Glenn Rosewall against KPMG, including that he was owed shares and other employee entitlements.

The court action against Ken Rosewall continues separately to the matter against his son.

He has already filed a defence to the action.

KPMG, which is backed by litigation funder IMF Bentham, is required to submit its evidence to the court in coming weeks on its claim against Ken Rosewall.

The remnants of BBY were acquired in 2015 by George Wang’s AIMS Financial Group and were subsequently rebranded as APP Securities.

The BBY saga has proven to be a long-running headache for thousands of investors, who are yet to have their funds returned.

Earlier court proceedings will see some funds repaid to several client groupings later this year.

Some of the customers caught up in the demise of BBY were subsequently able to make claims for lost funds under a compensation pool held in the National Guarantee Fund.

That differs, however, to the more recent collapse late last year of trading firm Halifax Investment Services, which was not an ASX market participant.

Halifax appointed Ferrier Hodgson as company administrators in November.

In its initial report, Ferrier Hodgson identified a “deficiency in investor funds held by the Halifax Group” as at November 23 of $19.7m, before costs.