Queensland Nickel forensic probe spared no blushes

Administrators FTI Consulting were hand-picked by Clive Palmer but spared nothing in their probe into Queensland Nickel.

Administrators FTI Consulting were handpicked by Clive Palmer, but spared nothing in their forensic probe into the downfall of Queensland Nickel and the businessman’s part in its collapse.

Immediately after their appointment on January 18, FTI’s team, led by John Park, was on-site to run operations at the Yabulu ­refinery in Townsville in north Queensland and dig through the company’s records.

Their aim and responsibility was to identify potential breaches of the Corporations Act by director Clive Mensink and apparent shadow director Clive Palmer, and to pinpoint whether the company had traded while insolvent and whether cash transactions flowing from Queensland Nickel could be voided and recovered.

The administrators dug back six financial years to July 1, 2010, the year after Mr Palmer took control of the plant from BHP Billiton.

Their investigative techniques were revealed in yesterday’s ­report, which will be scrutinised by creditors and corporate watchdog, the Australian Securities & Investments Commission.

Queensland Nickel’s IT staff was told to secure the computer systems to block “unauthorised access” and ordered to extract files, directories, email mailboxes and a backup copy of the company’s software system.

The administrators quizzed Mr Mensink and other senior managers and spoke with key ­employees, suppliers, and ex-workers, many of whom gave FTI leads about where to look. FTI also searched public corporate records to piece together Mr Palmer’s complex web of companies.

Mr Park yesterday said the fin­ancial records were in “good order”. However, he described as “unusual” the funnelling of money from Queensland Nickel to Mr Palmer’s corporate empire, and the annual forgiveness of loans by the refinery.

In March, Mr Palmer tried to retake control of the refinery, ditching as refinery manager the under-administration Queensland Nickel and replacing it with Queensland Nickel Sales.

But the move did not stop the digging.

The administrators yesterday found Mr Palmer and Mr Mensink may have acted “recklessly” as ­directors of QN and may have breached civil and criminal law.

Their work has not been cheap. The administrators’ remuneration will top $4.4m by the second creditors’ meeting on Friday. The fee will be paid from the joint-venture companies QNI Metals and QNI Resources that own the refinery and ultimately are controlled by Mr Palmer.