An investigation into Swindon Town FC owner's former businesses could have repercussions for the club itself, it has been revealed.

Clem Morfuni former firm, Axis Plumbing NSW PTY Ltd, is currently being closed by a liquidator who has found what he believes could be examples of wrongdoing.

Suggestions of failure to provide accounts, potential breaches of director duties and the possible breaking of Australian corporate law are among the things he is investigating.

It is also made clear that it still concerns both Mr Morfuni as former owner and director, as well as the company’s owner and director at the time of liquidation, James Skelton. 

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The liquidator, Peter Krejci, says as a result of their conduct there may be justification to pursue both directors 'personally for the quantum of any losses suffered, which could see them face a potential financial penalty.

In the report published by the Australian Securities and Investment Commission (ASIC), Mr Krejci said: “I have conducted preliminary investigations of the company’s affairs since my appointment, and I believe that there may be a potential insolvent trading/breach of director duty claim against the former director for $1.6m.”

This figure relates to debt owed to unsecured creditor The Shore Group, a Brighton-based construction firm, that is owed money after being commissioned by Axis M&E UK Ltd to provide staff for a project in London in 2019. 

When Axis M&E UK went into liquidation, Axis Plumbing NSW became liable for the debt because it had given a guarantee to The Shore Group.

At the time this contract was made, Australian national Mr Morfuni was sole director and shareholder of the firm Axis Plumbing NSW.

The Shore Group filed a UK High Court claim against Axis Plumbing NSW to retrieve the debt, in February 2022, which it won in September. 

Then in February 2023, just three months before Axis Plumbing NSW was placed into administration, Shore Group won a subsequent second High Court judgement in Australia, allowing it to pursue that debt in both countries. 

As part of an extensive investigation into the business, Mr Krejci discovered what he felt could be possible examples of wrongdoing such as not providing access to the company’s accounting software and books, insolvent trading, conducting an uncommercial transaction, and conducting an unreasonable director-related transaction. 

He also relays evidence of several breaches of Directors' Duties.

“I have reviewed the various aspects of these directors' responsibilities and have identified several actions that would be considered breaches of directors' duties,” he said.

This included duty of care and diligence, duty of good faith and duty not to make improper use of position.

The report says consequences of a breach of duties for the directors in liquidation could include a liquidator pursuing the directors personally for the total of any loss suffered by companies arising from the breach of duty. 

The ASIC could also prosecute the directors criminally for their conduct which could result in a maximum fine of $200k or imprisonment, or it could do so under a civil penalty provision which could also result in a maximum fine of $200k.

Other penalties include the ASIC giving them banning orders prohibiting them from managing a company.

The Shore Group has given the liquidator further funding to fully investigate these findings and is even pursuing court proceedings which would see Mr Morfuni summoned to an Australian court to give evidence publicly and under oath.

A spokesperson for The Shore Group said: “We are encouraged by the findings within the report, in particular, the activities of Clem Morfuni while the debt was accrued.

“The Shore Group will continue to pursue all options of further investigations, including funding a public examination with the liquidators of Clem Morfuni and James Skelton.”

There was another potential unsecured creditor with Osborne, also known as Geoffrey Osborne Ltd, filing a proof of debt to Mr Krejci for £508,460. 

Osborne entered a contract with Axis Services Group for a tower construction project in London in 2021, and it claims that Axis Plumbing NSW was listed as a guarantor for that contract.

But as the now-liquidated Axis Services Group was active at the time of writing, Mr Krejci stated this could not be pursued. 

Mr Morfuni was approached for comment but did not respond.