The long, troubled investigation into the financial collapse of the Peats Ridge Festival has revealed that over $1.3 million in ticket revenue is still unaccounted for as musicians, industry figures, and creditors begin to resign themselves to the conclusion that they will not be getting paid over the New Year’s music festival’s messy implosion, as TheMusic reports.
Peats Ridge Director Matt Grant first announced that the annual NSW event was ceasing and going into liquidation in January, triggering a thorough investigation into the promoter’s bookkeeping that revealed that the festival had reached a final debt figure believed to be $1,589,617.83, combined from money owed to artists, booking agents, food and beverage companies, police, and the taxation office.
Liquidators Worrells began digging deeper after unseating the originally appointed administrators Jirsch Sutherland after a meeting of creditors were unsatisfied with their efforts to search for missing profits from the embattled festival.
Beginning a thorough investigation in March with the creditors committee, nearly six months on, Worrells have gleaned $158,975 in company assets. But it’s a a sum that unfortunately doesn’t even begin to cover the fees of the two firms handling the liquidation, with Worrells tabling their latest report, issued mid-June, outlining to creditors that ticket revenue worth approximately $1.4 million cannot be located, dashing hopes that the lost funds will be recovered as money for the liquidation process runs dry.
The report shows that third party OzTix were engaged to handle the ticketing depositing the money from sales directly into the bank account of Matt Grant’s Peats Ridge Pty Ltd. The funds were then transferred to another of Grant’s registered companies, The Festival Company Pty Ltd, via a merchant facility before all but $73,000 of the $1,4 million was reportedly moved to yet another bank account in the name of The Festival Company which has yet to respond to queries over the transfers. “There is a litany of illegal behaviour, we believe, by the director…” – Mall Tulloch, MEAA
Christopher Darin, who is leading the Worrells liquidation, writes in the creditors report that he had notified the Australian Securities And Investment Commission (ASIC) about the Peats Ridge matter regarding section 533 of the Corporations Act 2011, that stipulates regulators notify ASIC over suspicious or illegal activity by a director or company representative.
Worrells believe that Peats Ridge Director Matt Grant may have breached codes of the Corporations Act related to insolvent trading, with a supplementary report “detailing potential offences committed by Grant;” including promises to creditors that forthcoming music events would raise capital to pay for debts over 2011 and 2012 editions.
Former administrators Jirsch Sutherland’s Andrew Spring tells TheMusic that they had also lodged a section 533 report with ASIC and believes that there have been several such submissions made implicating Grant in recent years. Mr Grant, who has been behind several insolvent companies in recent years, also ruffled the feathers of creditors who were concerned that an international “business trip” to France last March was a cover for skipping town on the investigation. Administrators believe that Peats Ridge Director Matt Grant may have breached codes of the Corporations Act related to insolvent trading.
Worrells also alleges dodgy bookkeeping among insolvent trading offences, with the report quoting that “someone had deliberately attempted to delete information” on a company computer, according to a hired IT expert, “the entire email database had been erased.”
There is enough for the ASIC to advise in response that they’ll be conducting their own investigation against the festival director as other companies of which Grant is a director of are wound up.
Mal Tulloch of the MEAA, who have been aggressively pursuing funs on behalf of unpaid artists and musicians, including the $95K fee owed headliners John Butler Trio, said that the missing $1.4 million ticket revenue did not represent a failure, emphasising that there were positive outcomes from the investigation.
“This whole process was to investigate how people in the industry are able to get away with ripping people off,” said Mr Tulloch. “There is a litany of illegal behaviour, we believe, by the director… We’re asking the regulators to ensure the companies are being wound up as they should be.”
“ASIC will be far more responsive to effected creditors expressing their disappointment that no action will be taken,” said Mr Tulloch urging creditors to pursue the issue. “They will need to do that in writing to ASIC and ask the obvious question as to why the regulator is prepared to turn a blind eye to illegal behaviour in the industry. Worrells have completed their detailed report it is up to ASIC to investigate.”