There is now growing anger that a whistleblower complaint from a former senior Zone RV employee was ignored.<\/p>\n
In September, former chief financial officer Kim Hodgkins reported allegations of misconduct and insolvent trading by the company during late 2023 to the Australian Securities and Investments Commission (ASIC).<\/p>\n
<\/p>\n
Zone RV sole director David Biggar, who co-founded the company in 2015, runs about 10 other businesses. (Supplied: Youtube)<\/p>\n
The ABC has seen a series of emails where Ms Hodgkins warned senior management in November 2023 that the company was running out of cash and spending needed to be slashed, due to a $5 million shortfall in revenue targets.<\/p>\n
“As previously discussed, our current [cash] position is we have $527,000,” Ms Hodgkins wrote.<\/p>\n
“We have $2.1 million of payments that are currently overdue.”<\/p>\n
Another email shows major electronics supplier Redarc put a temporary stop credit on Zone RV in October 2023 due to an unpaid account.<\/p>\n
When Zone RV collapsed, they owed Redarc almost $2.5 million.<\/p>\n
<\/p>\n
Kim Hodgkins reported Zone RV’s alleged misconduct to ASIC. (Supplied)<\/p>\n
Investigation declined<\/p>\n
ASIC told Ms Hodgkins by email on October 30 this year that it would not formally investigate her claims.<\/p>\n
“[We] are selective about the matters we pursue to ensure we use our resources to target misconduct effectively,” the regulator said.<\/p>\n
“We have considered all of the information you provided and conducted our own preliminary and confidential enquiries.<\/p>\n
“We have determined not to take any further action at this time.”<\/p>\n
Ms Hodgkins urged the watchdog to reconsider, and when they did not reply, she emailed ASIC chief executive Scott Gregson.<\/p>\n
Senior executive Peter Witham, in charge of misconduct reports and whistleblowers, replied on November 17, confirming ASIC would “undertake a review of our assessment of your report”.<\/p>\n
<\/p>\n
About 20 caravans have been released to customers who paid in full, but about 140 other people will not get theirs. (ABC Sunshine Coast: Josh Dye)<\/p>\n
Two days later, on November 19, Zone RV’s corporate advisor sounded out administrators Cor Cordis about a potential insolvency appointment, according to documents lodged with ASIC.<\/p>\n
Cor Cordis held several meetings with Zone RV’s sole director, David Biggar, in the following days, before the company formally entered administration on December 1.<\/p>\n
It is unclear whether there is any link between ASIC’s review of the whistleblower’s report and the administrators’ appointment.<\/p>\n
Customers furious<\/p>\n
Trudi Wight and her husband run a kitchen business in Kempsey and sold their investment property to buy a Zone RV caravan.<\/p>\n
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Trudi Wight in happier times, the day she purchased her Zone RV caravan.\u00a0 (Supplied: Trudi Wight)<\/p>\n
Ms Wight said losing life savings was “very distressing” and she was angry that ASIC initially refused to investigate claims of wrongdoing.<\/p>\n
“We pay taxes to [fund] ASIC, and I feel really let down \u2014 they’re meant to protect us in this situation,” she said.<\/p>\n
“If ASIC acted faster, perhaps people wouldn’t be in so much pain.”<\/p>\n
Brook Waugh owns a sawmill near Bellingen in northern NSW and says he is “pissed off” with the corporate watchdog.<\/p>\n
<\/p>\n
Brook and Katrina Waugh are angry that ASIC failed to act and say they will have to delay their retirement to make up for the money they have lost. (Supplied)<\/p>\n
Mr Waugh had paid Zone RV more than $150,000 in progress payments for his caravan.<\/p>\n
“What is the point of ASIC when they were notified but didn’t do anything for months?” he said.<\/p>\n
“They could’ve saved so many people so much life savings.<\/p>\n
“The people who were informed of this should be holding their heads in shame, it’s disgraceful.”<\/p>\n
Eduard Planken OAM \u2014 who acts as a spokesman for 86 out-of-pocket customers \u2014 has “a major problem with ASIC”.<\/p>\n
“This is a government body supposed to be working in the best interests of everybody,” he said.<\/p>\n
“They should have stepped in and said, ‘Halt’ before innocent people lost their money.”<\/p>\n
<\/p>\n
Eduard and Teri Planken have paid $154,000 towards their caravan, but feel pessimistic about recovering the money.\u00a0 (Supplied)<\/p>\n
Regulator handicapped<\/p>\n
An ASIC spokesperson told the ABC the regulator received more than 10,000 reports of misconduct each year but was only resourced to formally investigate a few hundred claims.<\/p>\n
“External administrators are required to report to ASIC if it appears to them that a person may have committed an offence or engaged in misconduct in relation to the company,” a spokesperson said.<\/p>\n
“It is the duty of appointed directors to prevent insolvent trading under the Corporations Act, and a range of civil and criminal penalties may be imposed by the court for any proven breaches.”<\/p>\n
Several customers are considering launching a class action against ASIC, although the regulator has broad immunity against litigation.<\/p>\n
The ABC is aware of at least four customers who have lodged fraud reports with the Australian Federal Police.<\/p>\n
In response to questions, an AFP spokesperson said: “This is not a matter for the AFP.”<\/p>\n
Cor Cordis will present its report to creditors in January, which will outline how Zone RV collapsed.<\/p>\n