Three years ago, two employees complained to the Labour Inspector, who then investigated the companies between May 30, 2023 and April 9, 2024.
The investigation included interviewing witnesses, analysing wage and time records, reviewing photographs of rosters and copies of manual cash payslips, and reviewing text messages and work group chats.
The inspector found multiple breaches of the Minimum Wage Act, the Holidays Act, and the Wages Protection Act, and estimated the two employees were owed more than $205,000 in wage arrears.
But a year after the Labour Inspector filed proceedings with the Employment Court, the two companies were put into voluntary liquidation by Dao.
All four nail salons were then sold.
Judge Kathryn Beck said in a decision from April 2025 that the businesses appear to have been sold “for a value below their real value, and/or they may have been on-sold to family or friends ‘on paper’ and could be operated by another legal entity with the first and second respondents remaining as the owners”.
The first liquidator’s reports for both KH68 and ALEX89 showed that, in addition to the money owed to employees, more than $1 million was owed to Inland Revenue in unpaid taxes.
KH68 and ALEX89 also sold five vehicles during the period the companies were engaged in mediation in relation to the court proceedings.
At the time of the proceedings, they owned eight Auckland properties – five owned jointly by the Dao and Viet Hung Ngyuen, as they are married.
The three properties owned by Dao and Viet Hung Nguyen had an equity of about $2.1m.
Viet Hung Ngyuen then owned two alone and one was owned by Duong Alex Nguyen.
“The applicant submits that the respondents’ omission to advise her of their intention to sell the four businesses and five vehicles demonstrates a real risk that the respondents are reorganising their affairs in a manner that could place their assets out of reach should judgment be issued against them,” Judge Beck said.
“Further, the applicant says the circumstances of the sale of the four businesses are of considerable concern.”
The sudden sale of assets led to Judge Beck granting a freezing order to stop the three business owners from selling anything further.
This has continued, with the latest freezing order being granted on December 11, 2025.
It still applied to property owned directly by Dao and Nguyen, but now excluded their bank accounts as long as the Labour Inspector is able to obtain balances and bank statements directly from the banks.
The latest decision released by Employment Court Chief Judge Christina Inglis this week revealed that the total arrears owed were $190,769.57, and Dao and Viet Hung Nguyen were jointly liable.
The decision said both parties had agreed that if a payment of $60,000 was made by the couple to the MBIE trust account by March 18, the Labour Inspector would drop all claims against Duong Alex Nguyen and he would be withdrawn from the proceedings.
The remaining arrears of $130,769.57 were to be paid into the MBIE trust account in 18 monthly instalments of $7264.97, which would start on April 13.
As the matter remained before the Employment Court, the Labour Inspectorate was unable to provide any further comment in relation to the case.
Any further issues relating to the case would be heard in court in mid-April, the decision said.
Brianna McIlraith is a Queenstown-based reporter for Open Justice covering courts in the lower South Island. She has been a journalist since 2018 and has had a strong interest in business and financial journalism.