ATO wins bid to liquidate Sam Mitchell’s WealthCheck empire

Liquidators will now pull apart Sam Mitchell’s WealthCheck Management business after the tax office won its court bid, leaving unpaid employees and other creditors still circling.

WealthCheck boss Sam Mitchell is understood to be in America after leaving Australia last month.

The Australian Taxation Office has won its bid to wind up would-be cattle baron Sam Mitchell’s WealthCheck empire after securing orders to place a key pillar of the Bondi businessman’s operation into liquidation.

Court papers reveal SV Partners liquidators have been appointed to oversee the wind-up of Mr Mitchell’s WealthCheck Management business, after administrators warned he could face a $6.6m cash call for potential insolvent trading.

The move by the Federal Court to grant the ATO’s applications to wind up WealthCheck Management comes after the tax office issued a $4m tax notice to Mr Mitchells in June.

This came after the ATO attempted to force Mr Mitchell to pay millions in unpaid superannuation and tax obligations, in the latest tax dispute dogging the agribusiness player’s business empire.

Documents show at least three companies connected to Mr Mitchell face more than $9m in unpaid tax claims.

SV Partners will now unwind Mr Mitchell’s WealthCheck Management operation, a key company in his broader cattle empire, providing services across the group.

Mr Mitchell had attempted to head off the ATO’s claims, appointing rival turnaround firm Worrells and indicating he was considering a Deed of Company Arrangement, which could have seen the Sydney businessman fund a debt deal.

However, a creditors report reveals no rescue plan has been forthcoming, with Worrells warning creditors could expect just 4c on the dollar from the limited assets held by WealthCheck Management, in contrast to its huge debts.

The administrator’s report reveals WealthCheck Management owed at least $7.5m when Mr Mitchell placed it in administration, with just $4.1m in potential assets.

The Worrells report found WealthCheck had been in ­financial strife since at least July 2018, marking its earliest point of alleged insolvency, and warning this had worsened in August 2022 when the company stopped making any payments to the ATO for GST or PAYG tax ­obligations.

While the liquidation of WealthCheck Management will at first be confined to the core company of Mr Mitchell’s cattle business, The Australian understands it is likely to pull apart the remainder of his empire.

Sources have indicated much of the cattle and agricultural assets managed or controlled by Mr Mitchell are secured by cross-guaranteed loans within the group.

The liquidation also kills off attempts by several of Mr Mitchell’s former staff to take court action against his companies for unpaid wages and wrongful dismissal.

This includes action by former ESG and farm compliance staffer John McKenzie, who claims he is owed more than $138,732 in unpaid wages and entitlements.

In addition, creditors are also targeting Mr Mitchell personally as well as his family trust, a company called The Edge.

Lender ADM Capital, which alleges Mr Mitchell owes more than $18m, is seeking to personally bankrupt the Bondi businessman in the NSW Supreme Court.

The Hong Kong-based financiers lent cash to a joint cattle enterprise between Mr Mitchell and LAWD real estate figure Danny Thomas.

A Cor Cordis report raises concerns Mr Mitchell has not disclosed any details regarding assets owned or held by the company or any amounts owing to or by The Edge TC.

Cor. Cordis partner Barry Wight notes “details in relation to the value and liability owing in relation to the shareholdings and unit holdings have also not been disclosed … by Mr Mitchell”.

“The Receivers and Managers reserves all rights in respect to further comment on the (Report on company activities and property),” he said.

Mr Mitchell, who is understood to be in the US, and the ATO declined to comment.

Originally published as ATO wins bid to liquidate Sam Mitchell’s WealthCheck empire