Grant Thornton administrators appointed to Chambers Investment Planners are recommending the company be wound up, after ASIC cancelled the troubled firm’s AFSL this week.
In the latest report to creditors, dated 1 October, administrators Matthew Donnelly and Gayle Dickerson have recommended that the company proceeds with a winding up motion, considering this option to be in the best interests of creditors.
However, the appointed liquidators make clear that under this scenario “unsecured creditors may receive no return”, meaning that a number of former clients who have filed claims against the firm for damages lost as a result of inappropriate advice given by Chambers advisers.
The liquidators prefer this option to the deed of company arrangement (DOCA) proposed by Chambers managing director George Takla and his family, despite the fact that a DOCA there is “certainty of a fixed contribution allocated to unsecured creditors”.
Notwithstanding this fixed return to creditors under the DOCA scenario, the liquidators maintain that “there is no material improvement in the return to creditors from the proposed DOCA”.
In addition, the report expresses concerns that a DOCA would mean that “detailed investigations into the company’s affairs will not be pursued”, while under a wind-up, the administrators would be willing and able to forward information about the company to ASIC for further investigation.
The Perth based financial planning boutique entered administration in July, after as many as 14 claims were filed against it with the Financial Ombudsmans Service – at least one of which resulted in a determination against the firm – causing a dispute with its professional indemnity insurance provider.
“We welcome any ASIC investigation,” Mr Takla wrote to ifa in a letter dated 14 August.
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