Brad Smith was named Young Australian of the Year twice before he was convicted of fraud. Now he owes more than $1million after another spectacular fall from grace

A motorcycle company owned by a two-time Young Entrepreneur of the Year and former Young Australian of the Year has gone bust with debts of more than $1 million.

Braaap Motorcycles Pty Ltd was declared bankrupt by the New South Wales Supreme Court on 7 August, owing 121 creditors at least $1.074 million.

Former motocross champion Brad Smith started his company in 2008 at the age of 17, after being disappointed with the quality of imported minibikes from China.

The following year he decided to travel to China, where he found two factories willing to make bicycles to his specifications for sale in Australia.

The company, headquartered in Carrum Downs in Melbourne’s south-east, sells and leases new and used bicycles across the country.

Braaap offers a lifetime warranty with every bike purchased. Customers are now wondering how they can claim that warranty.

Queenslander Liam Leonard is demanding a refund on a $5,000 bike he bought for his wife after the bike suffered “multiple” mechanical problems in just 18 months.

“The chain was way too tight on the bike. No flex. A break/snap in the chain at high speed could be fatal. They refused to send a new chain under warranty to get it fitted properly,” he told Daily Mail Australia.

‘After replacing the chain, the front sprocket seal broke (due to the original chain being too tight) and oil started leaking.’

Mr. Leonard said the lifetime warranty he paid an additional $250 for covered the $3 sealant for the broken gear, but not the labor costs.

In addition, he indicates that the speedometer gives an incorrect speed display and that the ABS brake sensor at the front of the bike is broken.

“We bought through Braaap because we wanted a learning bike for my wife. And with a lifetime warranty for an extra $250, how could we go wrong,” he said.

“We are still looking at possible actions. We will look at claiming the full price of the bike and the cost of the lifetime warranty from the liquidators.”

A few weeks before the company’s demise, Mr Smith spoke about what it means to be an Australian entrepreneur.

‘What we call entrepreneurs in Australia, we often mean founders. Everyone should be an entrepreneur, whether you’re the founder or the 10th employee,” the founder told Artisana Academy in April.

“If you look at the second, third and fourth employee, and you are good and very talented, then in most cases you will get a good bonus in the form of stock options.”

Mr. Smith began trading stocks at age 14, using money he had saved from racing motocross, and three years later he went full-time.

The teenager started selling motorcycles out of his garage and within the first year, when most of his friends were still in school, he sold $230,000 worth of stock.

In his book, DIRB IT UP: Do It Real Big, he shared that his parents mortgaged their house to finance his business.

“I understood the risk and I liked the pressure. They would never have let me do it if they thought I was just picking deals,” he wrote.

“They trusted me. They trusted my character and my brain. What a great gift for a parent to give to their child, the gift of self-confidence and trust.”

But it hasn’t always been smooth sailing.

In 2016, Mr Smith was arrested by New South Wales police and charged with a string of fraud offences. He was allegedly involved in a ‘rebirthing’ syndicate that crossed out and replaced serial numbers to resell motorcycles.

He was convicted of dishonestly obtaining financial advantage through deception and was sentenced to two years’ community service.

In 2019, Braap Wholesale pleaded guilty to six counts of approval to place identification plates and three counts of importing vehicles requiring modifications. The company was ultimately fined $25,000.

Braap Wholesale went bankrupt in 2020 and four years later Braaap Motorcycles Pty Ltd followed.

One of the company’s bank accounts had only $69.27 left in it, and other accounts had negative balances.

Liquidators Edwin Narayan and Graeme Ward of Mackay Goodwin have warned customers not to expect refunds, news.com.au defeated.

“Unfortunately, our office is unable to fulfill any orders placed by the company prior to our appointment, nor are we able to provide you with a refund,” Mr. Narayan and Mr. Ward wrote.

‘If you paid the deposit by credit card, you may want to contact your credit card company to discuss alternative options.’

Daily Mail Australia has contacted Mr Smith for comment.