The high profile collapse in April this year of Australian white goods business Kleenmaid, which included a franchise arm, is to be investigated with funding from the Australian Securities and Investments Commission (ASIC).

Joint Liquidator and Deloitte Partner, Richard Hughes said ñThis funding approval marks the beginning of the next crucial stage of the liquidation process. The investigation will focus on insolvent trading.

When 14 of the white goods business divisions went into liquidation in April 2009, with an overall debt in excess of $100 million, Kleenmaid franchisees lost their investments. Preliminary investigation of Kleenmaid’s finances suggested there may have been insolvent trading well before the company’s voluntary liquidation.

We will provide a detailed report to ASIC and then it is their decision whether or not they will bring a criminal case against the directors, said Hughes.

ñAt the same time the Liquidators will use the findings of the investigation as the basis for any civil action that we may bring to recoup monies on behalf of creditors. We will be providing an update on the investigation in the next few months as it is a very complex matter that will take some time to fully investigate. At this stage I would ask the creditors and consumers who have lost money to be patient while we continue our enquiries.î