JM Kelly Group director grilled over $3m term deposit
TROUBLED JM Kelly Group told the building watchdog it had $3 million in the bank even though it knew it could not access the cash, a court has heard.
Barrister Craig Wilkins, acting for JM Kelly liquidator Derrick Vickers of PwC, told the Federal Court that the Queensland Building and Construction Commission was told about the funds in September 2018 a month before the company collapsed owing creditors an estimated $50 million.
Mr Wilkins said the funds were in a term deposit that could not be used without the permission of the National Australia Bank but were described to the QBCC by JM Kelly as cash at hand. At the time the QBCC was performing an audit of the company's finance to see if its licence should be removed.
Mr Wilkins said JM Kelly founder Geoff Murphy told his son John Murphy, the director of the company, that while the funds could not be used it should be included in a financial report to the QBCC. Mr Wilkins said Mr Geoff Murphy told his son the $3 million meant the company's finances did not "look too bad."
Mr John Murphy told the court that he did not accept his father's opinion that the money could not be accessed.
Mr Wilkins also alleged that a list of debtors of the company sent to the QBCC had removed anyone owing money for more than 90 days. "You were trying to give the QBCC the impression that you did not have debts of more than 90 days," he said. Mr Murphy denied the information was deleted to mislead the QBCC.
The case continues.