Jirsch Sutherland partner Amanda Young has been sacked after allegedly stealing almost $240,000 from the accounts of insolvent companies she controlled as liquidator.
In a statement to Insolvency News Online (INO) late yesterday Jirsch Sutherland managing partner Bradd Morelli said that following undertakings Young provided to the NSW Supreme Court: “Amanda Young’s employment at Jirsch Sutherland has since been summarily terminated.”
She had also lodged with ASIC a request for suspension of her liquidator’s registration indefinitely, Morelli said.
Last Friday INO revealed that Jirsch had suspended Young’s employment pending investigations into alleged irregularities relating to a number of accounts she controlled as sole liquidator.
Young, who began work at Jirsch Sutherland in 2003, qualified for registration as a liquidator in 2013 and was made a salary partner of the firm in 2016.
In his statement Morelli revealed that she had allegedly misappropriated $238,502.23 from the liquidation accounts of four companies.
These were: Mamak Pty Limited (in liquidation); Roller Poster Company Pty Limited (in liquidation); St Gregory’s Armenian School Inc (in liquidation); and Admark Property Group Pty Limited (in liquidation).
$45,000 has since been recovered from solicitors’ trust accounts where it had subsequently been deposited. Morelli said there was no suggestion the laws firms were in any way complicit.
“It is alleged that funds from these liquidations were directed to accounts operated or controlled personally by Amanda Young,” Morelli said.
“In each case, these transfers took place without the knowledge or approval of any Jirsch Sutherland partner. There is no allegation or suspicion of any wrong doing by any current Jirsch Sutherland member of staff or Partner.
“The balance of $193,502.23 has been reimbursed into the subject liquidation accounts by the Jirsch Sutherland partnership pending any further recoveries from Amanda Young,” Morelli said.
Last Friday the Jirsch Sutherland equity partners sought and obtained orders for the replacement of Young as liquidator on a total of 18 appointments.
Young will be replaced by Morelli and partners Andrew Spring and Trent Devine, all of whom were listed as plaintiffs in the application brought against Young.
Also listed as plaintiffs were Victorian managing partner Glenn Crisp, Malcolm Howell, Lloyd Kerr and former NSW managing partner Sule Arnautovic, who is Young’s older brother.
In addition the files handled by Young will be scrutinised by an independent reviewer to be selected with input from ASIC, which has commenced its own investigation.
The corporate regulator said yesterday that it was alerted to the issue on December 11 and had been involved in discussions with the firm prior to the application last Friday, where it appeared as intervenor.
” …as part of the process, an independent reviewer would be appointed to review in the first instance the accounts of all administrations that Ms Young was appointed to,” an ASIC spokeswoman said yesterday.
“Creditors of all the administrations would receive a communication from Jirsch fairly disclosing the circumstances of the change in liquidators, the spokeswoman said, adding that ASIC had consulted with the Jirsch Sutherland leadership and concluded that it was appropriate Young be replaced with liquidators from Jirsch Sutherland despite the potential for the perception of conflict.
On Friday counsel for the plaintiffs told Justice Ashley Black that costs to creditors of changing appointees are generally lessened if the replacement is another liquidator from the same firm.
In the matter of FGM Print Pty Ltd and other Companies  NSWSC 1983 Justice Black agreed.
“It seems to me that the case for appointing a liquidator from another firm is not established, as matters stand, where that would expose creditors to significant additional costs and where there may be no reason to do so,” the judge said.
“I am reinforced in that view by the fact that there is no doubt, in the relevant circumstances, that these matters will be the subject of regulatory scrutiny.
For that reason, I am not satisfied that the Court should depart from the common practice, where a liquidator resigns, of appointing another liquidator within the same firm.
“I am reinforced in that view by the fact that ASIC takes the same view, in the context of this application,” the judge concluded.
Morelli said Jirsch Sutherland would continue to investigate in collaboration with ASIC.
“These matters constitute a most egregious breach of trust for which we are all profoundly disappointed,” he said.
“The Jirsch Sutherland Partners are unanimous in their commitment to ensure that appropriate scrutiny is applied to Amanda Young’s matters with ASIC’s involvement and that creditors are in no way disadvantaged by these events.”