The Sunshine Coast-based whitegoods business collapsed in April 2009 when major creditor Westpac Bank placed the company into administration.
The Sunshine Coast-based whitegoods business collapsed in April 2009 when major creditor Westpac Bank placed the company into administration. Jason Dougherty

Kleenmaid founder knew about massive loan: court

KLEENMAID'S founder was aware the company's spare parts arm was applying for a massive loan - even if he did not know the details, a court has heard.

Two former directors of Kleenmaid, Andrew Eric Young, 62, and Bradley Wendell Young, 44, have pleaded not guilty in Brisbane District Court to fraud and insolvent trading.

The Sunshine Coast-based whitegoods business collapsed in April 2009 when major creditor Westpac Bank placed the company into administration.

The bank had previously lent Kleenmaid's spare parts arm Edis $13 million.

Crown prosecutor Stephen Keim claims the Youngs had misled Westpac about the financial health of Kleenmaid and how intertwined Edis was with it.

The third former director of the Sunshine Coast-based company Gary Armstrong told the court on Monday that Andrew Young had never objected to Edis applying for the loan.

Andrew Young's defence barrister Simone Bain had suggested to Mr Armstrong that Andrew Young had no knowledge of the loan with Westpac.

But under re-examination from Mr Keim, Mr Armstrong said although Andrew Young, who founded Kleenmaid, may not have known the details "he was aware" of the plan.

"He raised no objection to (the proposed $13 million loan)," Mr Armstrong said.

Mr Armstrong told the court the Youngs had advised him not to disclose Kleenmaid's financial position to Westpac when applying for the loan through the Edis business.

The Kleenmaid brand was sold in 2009 to Compass Capital Partners and the company now operates out of Sydney.

The hearing continues.

- ARM NEWSDESK


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