SMB Advisory was appointed liquidator on October 3, but met with Harolds’ management in May and determined at that time that a “liquidation scenario is a likely future”.
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“My investigation into the Harolds Group matter will include whether Harolds Group was trading during insolvency and as a result the liquidator will pay the directors an amount equal to the loss or damage suffered by the company. Make sure to include whether you have any recourse,” said the SMB Advisory administrator. Headteacher Andrew McNeil told the masthead:
Mr McNeil said he was informed by Harolds Company director Ross Paulakis that the majority of the shares had been sold prior to liquidation during a sale by a third party, with the proceeds paid into Harolds Group’s bank account. Ta. About 730 items remain unsold, McNeil said.
The liquidator said it would also investigate a series of multi-million dollar intercompany loans made between companies within the Harolds Group.
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“Although the Commissioner estimates that there will be no recovery from the related party loan accounts, I intend to require the related parties to repay their respective loan accounts in full,” McNeil said.
He said the investigation was still in its preliminary stages and creditors would be provided with a comprehensive update in a statutory report due by January 3.
Ross Paulakis did not respond to questions from this masthead, but in a statement last week he said the company was struggling to navigate the post-COVID-19 retail landscape.
“Despite our best efforts to adapt to the evolving economic environment, reduced spending on luxury goods, reduced foot traffic, unprecedentedly high levels of CBD office vacancy, and extremely unfavorable government policies This has combined to significantly impact our ability to sustain our operations,” he said.
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But the end of his fashion empire hasn’t dampened Paulakis’ passion for racing expensive sports cars.
In August, the 36-year-old was announced as the new Aston Martin AMR Vantage GT3 driver for the Sydney-based Volante Rosso Motorsport team.
Meanwhile, his father, Harolds founder John Paulakis, has been spending the past few months on a Greek island.
John Paulakis, 66, who opened the first Harolds store in Melbourne 39 years ago, posted an image of himself dancing around a fire holding an empty bottle on July 25, according to his Facebook account. Posted.
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In 2018, John Paulakis pleaded guilty to assaulting his elderly parents and destroying their home, but was spared a conviction and sentenced to a community corrections order at Heidelberg Magistrates’ Court.
He also avoided prison in 2015 when he was convicted of fraud in county court for using false invoices to avoid $1.47 million in taxes.
Judge Carolyn Douglas sentenced him to five years in prison, but ordered him to be released on a $40,000 good behavior bond for five years.
From 2002 to 2006, he used fake invoices to avoid import duties on luxury clothing imported from Europe.
John Paulakis did not respond to questions from this masthead.
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