Plumbing business collapses: Victoria-based C&S Plumbing Pty Ltd goes bankrupt with $12 million

The CEO of a plumbing company that went bankrupt with more than $12 million in debt had paid himself a six-figure salary in the months leading up to the collapse.

C&S Plumbing Pty Ltd, in Benalla in northeastern Victoria, collapsed on March 27 with $0.0 in its bank account and owed $12.2 million to more than 100 creditors.

Simon Nelson of BPS Recovery and Reconstruction has been appointed as liquidator for the company, which also has an office in Melbourne.

C&S Plumbing is still offering services for commercial and residential projects on their website, which is still live as of this week.

Of the $12.2 million owed by the company, $1.9 million belongs to 76 former employees for unpaid wages, pensions and cuts, while $3.7 million is owed to the Australian tax office, news.com.au reports.

Documents filed with ASIC by the liquidator include allegations that C&S Plumbing’s sole director, Shane Arnold, paid himself a six-figure salary in the months leading up to the company’s collapse.

The report says Mr Arnold “began to receive significantly higher wages” from November before the company went bankrupt in March.

C&S Plumbing is still offering services for commercial and residential projects on their website, which is still live as of this week

“This was by way of redemption of outstanding annual leave and RDO balance,” it said.

“An overview of Mr. Arnold’s pay slips … indicate that Mr. Arnold received the gross amount of approximately $101,000 during that period.”

The report also contains allegations that the CEO sold his company’s assets to another company involving one of his family members.

C&S Plumbing employees were employed by Arnold Land Development, a company whose director is a relative of Mr. Arnold.

Workers spent 261 hours completing $456,665 worth of work on the land, but the significant amount was never paid to C&S Plumbing.

The liquidators have since requested that the amount be repaid to the company.

Machines and installations have been sold to Arnold Land Development in a ‘voidable transaction’ which can now be seized by the trustee.

When creditors took the company to court over unpaid debts, Mr Arnold was unable to pay any of these and has indicated he will be declared bankrupt according to documents filed with the company watchdog.

In giving reasons for his company’s collapse, Mr Arnold said he owed $1 million from a builder who allegedly refused to pay for work.

He added that rising costs and the pandemic also affected business.

In giving reasons for his company’s collapse, Mr Arnold (pictured) said he owed $1 million from a builder who allegedly refused to pay for work

C&S Plumbing Pty Ltd, in Benalla in northeastern Victoria, collapsed on March 27 with $0.00 in its bank account and $12.2 million owed to more than 100 creditors

When the liquidator intervened, there was $0.00 in the company’s bank accounts.

“I have not recovered any money from the company bank accounts,” Mr. Nelson wrote in documents submitted to ASIC.

Daily Mail Australia contacted C & S Plumbing Pty Ltd and Mr Arnold for comment.

It comes just weeks after it was announced that plumbing company Richstone Group Pty Ltd went bankrupt in June after a failed restructuring attempt.

The company had only $61 in its bank account at the time it went under and owes a whopping $22 million to creditors, according to documents filed with the corporate watchdog.

David Coyne, administrator of insolvency firm BRI Ferrier, said in a document filed with ASIC and viewed by Daily Mail Australia that the company’s bankruptcy “appears to be due to debtors failing to pay their debts in full”.

Staff are believed to owe up to $816,000, including unpaid wages and pension, while $14 million is owed to the ATO.

Richstone Group blamed deteriorating market conditions and the pandemic for their revenue decline from $65 million to just $25 million last fiscal year.