The Australian Taxation Office (ATO) and the Australian Financial Security Authority (AFSA) have rejected embattled Sydney publican Jon Adgemis’ proposal to settle $1.5 billion in debts, citing concerns over the minimal return to creditors and his continued extravagant lifestyle.
Adgemis, founder of Public Hospitality, appeared at a creditors’ meeting on Friday at Sydney’s Radisson Hotel, where his offer of just 0.17 cents in the dollar ($2.5 million), partly funded by relatives, was met with sharp criticism.
The ATO, owed nearly $162 million, wrote to the trustee WLP Restructuring condemning the “meagre sum” and questioning Adgemis’ $60,000-per-month Bondi Beach rental and use of luxury vehicles, including a Mercedes-Benz G Wagon.
Deputy Commissioner Julian Roberts noted, “It appears the debtor has access to significant monies but has chosen to direct these monies towards lifestyle expenses and not creditor payments.”
The bankruptcy regulator AFSA also intervened in the meeting, raising doubts about the adequacy of investigations into Adgemis’ financial affairs.
AFSA’s Neville Matthew noted the trustee had not verified Adgemis’ claim of having no superannuation.
Additional concerns were raised over a major GST liability and potential misconduct, with one legal representative alleging GST irregularities “in the tens if not hundreds of millions of dollars.” A sales process for some of Adgemis’s pubs is reportedly underway.
The vote on Adgemis’ insolvency deal has been postponed, with another creditors’ meeting scheduled for August 29.
Source: The Daily Telegraph.
