Bankrupt man owing $1.4m goes on $140k shopping spree
A QUEENSLAND man who spent $140,000 on racing car parts furniture and supplements after going bankrupt owing $1.3 million to creditors has pleaded guilty to two charges under Commonwealth bankruptcy law.
Nicholas Gannon was sentenced in the Caboolture Magistrates Court to charges of disposal of property after bankruptcy and failure to fully and truly disclose to the trustee all of his property and its value.
Gannon filed for voluntary bankruptcy in May 2013 owing creditors more than $1.3 million.
During his bankruptcy he received more than $150,000 as an inheritance.
Commonwealth law requires bankrupt people to let their trustee know if they receive money or assets during bankruptcy.
Gannon didn't tell his bankruptcy trustee about the money, and instead made several cash withdrawals.
He also transferred money to friends and made a number of large purchases including racing car parts, supplements and furniture, spending almost $140,000.
An Australian Financial Security Authority investigation prompted Gannon to repay $150,000.
A dividend can now be paid to those who were owed money.
Gannon was sentenced to 12 months imprisonment on each of the two charges.
He was released on a recognisance of $3000 to be of good behaviour for two years and was
also ordered to pay court costs.
Australian Financial Security Authority Deputy chief executive gavin McCosker said a community tip-off led to the charges against Gannon.
"He chose to not only to attempt to hide the money that he had received, he also went out of his way to spend it," Mr McCosker said.
"The existence of the money was only discovered in November 2017, thanks to a tip-off from the community.
"We encourage anyone who suspects wrongdoing by a bankrupt person to submit a tip-off - they are a vital source of intelligence and can make a real difference."
Gannon has since been discharged from his bankruptcy, effective May 8, 2016.