NSW man convicted after gambling away $70k prior to bankruptcy

On 31 March 2020, New South Wales man Mr Robert Bruce King was sentenced in the Downing Centre Local Court after he pleaded guilty to two charges under Commonwealth bankruptcy law.

Both charges carry a maximum penalty of 12 months imprisonment.

Mr King voluntarily filed for bankruptcy in July 2017, citing unemployment. Less than a year before his bankruptcy, Mr King received over $130,000 from the sale of his Wentworth Falls property.

Rather than using the money to pay off debts totalling approximately $88,000, Mr King withdrew $76,500 over a three month period. He later claimed to have gambled the money away playing pokies across Sydney.

Under Commonwealth bankruptcy law it is illegal to dispose of money and assets in the 12 months prior to filing for bankruptcy. The law also requires bankrupt people to provide a full and truthful account of their financial situation.

When filing for bankruptcy Mr King provided a false statement, claiming that he had received $30,000 less from the sale of the property.

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

“AFSA is a firm and fair regulator,” Mr McCosker said.

“It is important that we take action against those who purposely attempt to misuse the system.

“For most people, bankruptcy is a difficult and stressful situation. However, it is important that people entering into bankruptcy are honest and do the right thing.

“Disposing of funds and assets before going bankrupt, and then being dishonest when entering bankruptcy, is not only unfair to genuine creditors, it is also illegal.”

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

In sentencing, Magistrate Crompton took into account the nature and seriousness of the offending, the loss or damage resulting from the offence, the degree of contrition shown for the offence, the general and specific deterrence and Mr King's mental condition.

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Sentence and charges

Mr King was convicted and released without passaging sentence upon entering into a recognizance of $500 on condition that he be of good behaviour for two years. He was also to comply with the treatment plan as detailed by his treating psychiatrist.

Mr King pleaded guilty to two charges:

  • Concealing, removing, disposing of or dealing with property within 12 months prior to the presentation of a petition by which he became bankrupt contrary to section 265(7) read with section 265(4)(a) of the Bankruptcy Act 1966, and
  • Knowingly making a false declaration in a Statement of Affairs contrary to section 267(2) of the Bankruptcy Act 1966.

AFSA Enforcement snap-shot 2018-19

In 2018-19, 96 persons were prosecuted for a total of 145 charges during the year. Of those charges, 11 were withdrawn, 122 proven with conviction, 4 proven without conviction, 7 were dismissed and 1 not proven.