Bankrupt Victorian man convicted after concealing $250k transfer to friend

On 20 February 2020, Mr Robert John Wilson was convicted in the Dandenong Magistrates’ Court after he pleaded guilty to two charges under Commonwealth bankruptcy law.

Mr Wilson, who became bankrupt for a second time in June 2017, received over $250,000 from the sale of his house in September 2015. Mr Wilson provided false statements regarding the whereabouts of the money, telling the Official Trustee in Bankruptcy that he gambled it away.

An investigation by the Australian Financial Security Authority (AFSA) found that Mr Wilson had the $250,000 transferred into a friend’s bank account when the property was sold. Over time, Mr Wilson’s friend withdrew all of the funds and the account was closed.

Commonwealth law requires bankrupt people to fully and truthfully disclose all funds and assets in their statement of affairs. The trustee uses the bankrupt person’s funds or assets to repay people who are owed money.

AFSA Deputy Chief Executive, Gavin McCosker, explained that AFSA pursues convictions to help maintain the public’s confidence in the personal insolvency system.

“For most people bankruptcy is a difficult and stressful situation,” Mr McCosker said.

“However, it is important that people entering into bankruptcy are honest.

“Failing to disclose funds and assets is both unfair to genuine creditors and illegal.

“It is important that we take action against those who are dishonest and break the law.”

The matter was prosecuted on behalf of AFSA by the Commonwealth Director of Public Prosecutions.

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Charges and sentence:

Bankruptcy Act 1966 (Cth)

Mr Wilson pleaded guilty to two charges under the Bankruptcy Act 1966 (Cth):

  • Dealing with property to the value of $20 or more within 12 months before the presentation of the petition which made him bankrupt contrary to section 265(7) read with section 265(4)(a) of the Bankruptcy Act 1966 (Cth), and
  • Failure to fully and truly disclose to the trustee such information about his conduct and examinable affairs as the trustee requires contrary to section 265(1)(ca) of the Bankruptcy Act 1966 (Cth).

Mr Wilson was convicted of both charges and ordered to enter a recognizance – with $1,000 as security – that he would be of good behaviour for 12 months.

Mr Wilson will remain bankrupt until 29 June 2025.

Useful links:

Personal Insolvency Compliance Report

In 2018-19, AFSA received nearly 2,000 referrals of alleged misconduct. We analysed each referral and found that 744 warranted further investigation. We referred 115 of these matters to the Commonwealth Director of Public Prosecutions.

In total, 96 individuals were prosecuted for offences under the Bankruptcy Act. Our prosecutions attracted wide-ranging penalties, from fines to imprisonment.

Pleasingly the number of prosecutions decreased in 2018-19, down from 137 in the previous year. The overall value of proven fraud also dropped, down from $5.5 million in 2017-18 to $4.6 million.