KLEENMAID: Former director denies fraud
A FORMER Kleenmaid director has denied a massive company restructure was designed to mislead banks.
Former director Gary Armstrong told Brisbane District Court even the company's accountants were surprised at how interdependent Kleenmaid and spare parts company Edis became after the restructure.
Former Sunshine Coast-based Kleenmaid directors Andrew Eric Young, 62, and Bradley Wendell Young, 44, have pleaded not guilty to fraud and operating the company when it was insolvent.
In his opening address Crown prosecutor Stephen Keim told the court a restructure between Edis and Kleenmaid was designed to get loans from Westpac.
Under cross-examination from Bradley Young's defence lawyer Chris Minnery, Mr Armstrong denied the "primary" purpose of the restructure was to mislead banks.
Mr Armstrong agreed with Mr Minnery's suggestion he and the Youngs had never had a discussion where they said the restructure was primarily designed to "mislead potential lenders".
The Youngs have been accused of deliberately not telling Westpac how intertwined Edis was with Kleenmaid and the precarious financial state Kleenmaid was in.
Mr Armstrong said the degree of interdependence between the Edis and Kleenmaid after the restructure would have "surprised" Westpac.
He told the court he had the best working relationship with Westpac and had performed almost all of the discussions with the bank over the loan.
The Kleenmaid brand was sold in 2009 to Compass Capital Partners and the company now operates out of Sydney.
The hearing continues.
- ARM NEWSDESK