Bankrupt Auckland chartered accountant Stuart Francis Clarke's imprisonment for three years after pleading guilty to Insolvency Act offences committed six years ago was reduced by nine months on appeal. Clarke was convicted of: increasing creditor losses through extravagant living; concealing assets; failing to co-operate with Insolvency Service and managing a business whilst bankrupt.
The High Court was told Clarke went on a spending spree as Westpac closed in, threatening bankruptcy on a $322,300 debt. Over a five month period in early 2014, shortly before his bankruptcy and immediately after, he spent a total of $84,160 at restaurants and bars together with other cash purchases; an average of some $4000 per week. He attempted to disguise his one-quarter interest in the then family home at Trinity Street, Ponsonby and to muddy an ownership interest in his sole practice accounting firm: CK Accountants. Whilst bankrupt, he continued to operate his accounting business salting away income in a $78,000 bank account hidden from Insolvency Service. He was unco-operative when questioned about trusts and other entities apparently under his control.
On appeal, Clarke said the trial judge had overstated assets concealed from Insolvency Service. The true total, he said, was the $78,000 eventually uncovered. His business CK Accountants was worthless, he said. All clients had transferred to other tax and business advisers. His quarter share in the former family home was identified by Insolvency Service and was now under its control. Nine months reduction in imprisonment was justified, Justice Woolford ruled.
Clarke v. Business, Innovation & Employment – High Court (4.02.20)
20.026