A win in the NSW Supreme Court by a group of traders could be the breakthrough needed to unlock millions of dollars from the trading accounts of failed stockbroker BBY.
The messy fall of BBY has left client accounts frozen with millions of dollars owed but no simple way to get the money back.
However, the NSW Supreme Court has given a group of about 60 former clients leave to file their own case against BBY.
Liquidator KPMG’s Stephen Vaughan told the ABC this is an important step forward “for former clients and creditors of BBY in establishing an orderly process to clarify and establish potentially competing entitlements in respect of funds held in client monies accounts”.
Without the action, it could have taken months or even years to unravel who owns what in the trust accounts.
Investigations by administrators, Stephen Vaughan and Ian Hall of KPMG Australia, show indications of possible misuse of client trust funds as early as June last year.
The return to unsecured creditors is estimated at 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 BBY’s options trading business.
All 170 staff were made redundant and are all creditors. Some have been rehired at AIMS Financial, which acquired some of the broker’s assets and has restarted the business.