A property investment firm that collapsed owing $124 million had no income-generating assets, no auditor and was effectively insolvent since its inception, administrators of the company have told investors.told a creditors meeting on Monday the company raised millions of dollars from hundreds of investors over five years for property developments, promising them guaranteed quarterly returns on a 12-month term.
About 69¢ of each dollar invested appeared to go into operations expenses and another 11¢ to commissions and risk fees, he said. Mr Baskerville said that even when it was first established, the administrators’ preliminary investigation indicated Remi Capital might have had just $3 million in equity but $60 million in debt.
“That’s a gap in the capital requirements, so investor number two needs to come in with $1.20 to cover the gap in capital of investor number one,” he said. “My understanding is there is no appointed auditor. My further understanding is there [are] no audited financial statements,” Mr Baskerville said.He said Mr Prestige had claimed to have caused the company to submit a lot of tax returns and financial statements when he replaced Mr Terrill as sole director.