John Pesutto personally served bankruptcy notice over $2.3m debt

John Pesutto has been personally served with a bankruptcy notice over the $2.3m owed to colleague Moira Deeming, as senior Liberals work to lock in a bail out deal to help him pay the debt.

Embattled former Victorian Opposition Leader John Pesutto has been personally served with a bankruptcy notice over the $2.3m owed to colleague Moira Deeming.

Mr Pesutto was personally served with the notice shortly before 5pm on Friday, almost five days after the notice was lodged with the Federal Court for assessment and approval.

It comes as senior Liberals work to lock in a bail out deal for Mr Pesutto that would see him loaned up to $1.5m to allow him to honour the debt.

Sources said under a deal being considered Mr Pesutto would have to repay the loan but could exercise an option to fundraise on the party’s behalf for a portion of it.

John Pesutto has been personally served with a bankruptcy notice. Picture: Ian Currie

A deal is expected to be finalised in coming days, sources familiar with ongoing negotiations said.

It would bring to an end months of uncertainty because of the prospect Mr Pesutto would be ineligible to sit in parliament if he couldn’t pay the massive legal bill and was bankrupted.

Such a move would trigger a potentially damaging by-election in Mr Pesutto’s Hawthorn electorate which senior party officials fear would be lost to a strong independent candidate.

Lawyers for Mrs Deeming have warned they could pursue high profile donors to Mr Pesutto’s legal defence including former premiers Jeff Kennett, Ted Baillieu and Denis Napthine.

While Liberal powerbrokers are convinced such a move would not succeed, they are terrified about the protracted impact it would have on the party as the legal case was prosecuted.

They believe it would effectively kill the Coalition’s chances of winning government at next year’s general election.

Moira Deeming speaks to the media after being accepted back into the Liberal Party. Picture: Andrew Henshaw

On Wednesday night organisers of a public fundraising campaign set up to support Mr Pesutto said they would no longer be accepting donations.

“We are hopeful now of a favourable outcome for John,” organiser Elizabeth Sceney said.

“We are pausing further donations to this campaign and will update you when we know more. Thank you for your support.”

Former Premier Jeff Kennett sensationally intervened in Mr Pesutto’s debt problem this week, urging the Liberal Party’s administrative committee to find a solution.

In his letter to the committee Mr Kennett outlined 10 reasons they should pay, including the more than two year impact the case has had on the party.

The ongoing public battle between Mr Pesutto and Mrs Deeming has plagued the party for more than two years since it began in March 2023.

Originally published as John Pesutto personally served bankruptcy notice over $2.3m debt