Investigators have upped the estimated shortfall of funds at failed stockbroker BBY to $16 million from $10 million.
The administrators, Stephen Vaughan and Ian Hall of KPMG Australia, say there are indications of possible misuse of client trust funds as early as June last year.
They have provided a report to ASIC, the corporate watchdog, updating the shortfall number from the $10 million estimated last week to $16 million now.
“There may be a shortfall in the BBY Limited client monies accounts in the order of $16 million against the total client trust account obligations of over $30 million,” Vaughan and Hall say in an updated report.
The number could go higher as investigators go deeper into the books.
The extra $6 million shortfall relates to Saxo Capital Markets, an online trading platform. BBY had been a white label client, using SAXO’s trading systems. This relationship ended on April 1 this year.
There will be a second meeting of creditors Monday next week when the administrators will recommend BBY companies be liquidated.
Unsecured creditors of the BBY companies are likely to receive distributions of between zero and 24 cents in the dollar.
Executive chairman Glenn Rosewall, the son of the tennis great Ken, called in administrators on May 17 under the weight of increasing liabilities from its options trading business.
All 170 staff have been made redundant and are all creditors. Some have been rehired at AIMS Financial which has acquired some of the broker’s assets and has restarted the business under the same name, BBY.
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