HERE’S news for all you doubters out there, all you nay-sayers who said it wouldn’t happen.
The Australian Securities and Investments Commission has finally done something official about the construction group Hightrade.
That’s the group that was in the Hunter from 2006, leaving a trail of liquidated companies, unpaid debts, a tax bill of more than $100million and general mayhem in its wake.
ASIC, you will be pleased to know, has made the director of one of the Hightrade companies – and there were more than 100 companies – a ‘‘disqualified person’’ for the next three years.
Constantine Nicholas Cockinos, 73, whose name once graced a plaque above the door at what used to be known as Resort Hunter Valley at Lovedale, is officially barred from being a company director until September 3, 2016.
And that’s about it, as far as I can tell.
There might have been a revolving door of directors through Hightrade companies over the years, and the group might have been investigated by the Australian Taxation Office, but Mr Cockinos’s disqualification is about the only official sign anyone has been held accountable.
I phoned one of the earliest Hightrade creditors, former Wallaby Michael Martin, to break the news. It was a special moment for both of us.
Me: ‘‘ASIC has finally done something official about Hightrade. It’s disqualified Con Cockinos.’’
Mr Martin: ‘‘... [a pause while he laughed]. I don’t know what to say.’’
Me: ‘‘That’s a first.’’
Mr Martin: ‘‘That’s bureaucrats for you. If they ran the country as well as they taxed some of us, we’d rule the world.’’
Mr Martin started complaining to the ATO and ASIC about Hightrade in 2006, after one of its companies, Reica Constructions, was wound up during construction of the Lovedale resort, owing the ATO $36million, and millions more to subcontractors.
Mr Martin, a Lower Hunter roof contractor, lost a lot of money. It was the first of a succession of company collapses and rebirths involving major Hightrade projects between 2006 and 2009, including the Sky Central project at Charlestown.
The complaints didn’t get him very far. Typical of the responses was a 2008 letter from the ATO, noting that ‘‘combating phoenix activity is difficult and time-consuming and will always have an element of reactivity, as the mischief is often not recognised and generally does not even crystallise into something legally challengeable until the new ‘phoenix’ company has arisen’’.
The Hightrade case has had some interesting spin-offs over the years.
The Department of Local Government investigated Cessnock City Council in 2008, largely because of Herald articles about how the council ended up a Reica creditor to the tune of $400,000. The money was repaid by a Hightrade ‘‘friend’’ in an arrangement that even surprised councillors.
The council was ultimately found to be dysfunctional, at risk of corruption, lacking in leadership and with evidence of an ‘‘inappropriate culture’’ involving gifts and benefits.
But Hightrade’s reach didn’t stop at local government level.
In November 2009 Labor Upper House MP Henry Tsang resigned from Parliament over his hidden six-year relationship with the company. Mr Tsang resigned along with Joe Tripodi and Ian Macdonald when the then NSW Premier Nathan Rees made a short-lived move against his ‘‘liabilities’’.
It came after a battle between the Herald and Mr Tsang over undeclared benefits from Hightrade. Over a splendid few weeks he repeatedly denied stays at the Hightrade-owned Lovedale resort, only to have to confirm them when the Herald provided proof.
Federal Labor MP Laurie Ferguson was caught up in the Hightrade saga after supporting the company when it underpaid 457 visa workers.
The last public reports about Hightrade head Li Zhang were in 2010 and 2011 over tax debts. Mr Zhang lost a NSW Supreme Court battle to stop the ATO from pursuing him for more than $6.3million in unpaid personal tax between 2003 and 2007.
In June 2010 Con Cockinos told the NSW Supreme Court he signed documents during his 18-year association with Hightrade, but didn’t ask questions because he feared losing his house. How that was to happen was never explained.
During the ATO-funded court case he said Hightrade representatives would ask him to ‘‘sign here, I’d sign it, and they’d go away’’, he said.
So here we are, more than three years later, and finally ASIC has listed Mr Cockinos as a ‘‘disqualified person’’. It’s a lesson to all of us, but not the lesson it should be.
As a liquidator said this week, ‘‘stuff-all’’ really happened after the Hightrade debacle. I couldn’t have put it better myself.