Posted October 07, 2018 09:31:06 The ABC’s Datastore team is looking at the evidence that led to the firing of a Brisbane company’s CEO after a series of problems.
We know the CEO lied to the board about the company’s financial performance and was told it would be profitable by the end of the year.
The CEO also lied about his time in Australia.
But the facts are less clear.
What the ABC has uncovered shows that the CEO’s company had a $9.8 million debt and had paid off about $700,000 of it before the first audit came out.
In December 2016, the ABC found the CEO had made a $2 million payment to a company he was using as a “proxy” to help pay for the company, which was running at less than half its full capacity.
The company, called Cascadia Technologies, was not running at full capacity and the CEO made payments to the company to help the company pay off the debt.
But the CEO was still paid about $1.8million.
And the CEO told the board he could not explain why the company was paying so much for the debt, so he made the payment to the proxy company.
The proxy company, a company called Cravath, Swaine and Moore, had been paid $6.3 million by the company for “services” the CEO could not use because it was a proxy for Cascada Technologies.
“It’s a great example of a corporate person being paid a high salary for nothing,” the ABC’s senior legal analyst David Hickey said.
“If you are the CEO, you’re entitled to that salary and there’s no question about that.”
The ABC has spoken to more than 20 former and current employees of the company.
They say the CEO misled them about how much money he was making, about the debt and about the financial performance of Cascades, the parent company of Cydonia.
And they say the company did not tell the board that the debt was being paid off by the proxy firm.
“The board has told me that we have the evidence,” one former employee told the ABC.
He said he believed the board should fire the CEO.
Mr Hickey is investigating whether the company breached its fiduciary duty.
If the board decided to fire the chief executive, he said, it would have to justify why.
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