Join our daily newsletter At The Bell to receive exclusive market insights
- Automobile repairs company AMA Group (AMA) is officially taking ex-CEO Andrew Hopkins to court as it looks to recover $2.4 million from the former boss
- The cash relates to findings from an investigation by forensic accounting firm McGrath Nicol last year that ultimately led to Andrew’s resignation
- AMA is looking to recover $1 million from alleged unauthorised expenses incurred by the former CEO
- The company also claims Andrew has an outstanding employee loan of $1.4 million that he was supposed to repay upon his resignation
- The investigation was launched into Andrew Hopkins in September 2020 following allegations from a company employee
- Andrew went to the Federal Court in late January this year, claiming he was being oppressed as a minority shareholder, but he resigned a few days later
- Now, AMA alleges he owes the company just shy of $2.4 million, and the company has taken the matter to the Federal Court
Automobile repairs company AMA Group (AMA) is officially taking ex-CEO Andrew Hopkins to court as it looks to recover $2.4 million from the former boss.
The cash relates to findings from an investigation by forensic accounting firm McGrath Nicol last year that ultimately led to Andrew’s resignation.
Specifically, AMA is chasing $1 million from alleged unauthorised expenses incurred by the former CEO and another $1.4 million from an outstanding employee loan that Andrew is yet to repay.
The investigation
AMA told shareholders in January it had engaged McGrath Nicol to investigate Andrew after receiving allegations against the then-CEO in a protected disclosure from a company employee.
The company has not shared the details of the allegations, but shares tumbled on January 27, 2021, when the investigation was announced to shareholders. At the time, Andrew made an application to the Federal Court of Australia claiming he was being oppressed as a minority shareholder.
On February 1, however, Andrew resigned as CEO and from the AMA Board. He was replaced by Board member Carl Bizon.
Since then, AMA told shareholders it had started the process to recover $1 million from the ex-CEO, though it did not specify what the funds were for until today.
On top of this, Andrew had previously taken out an employee loan of just under $1.4 million in the 2016 financial year when AMA bought out Gemini Accident Repairs Centres.
AMA claims that the deal was for the loan would gradually be extinguished as Andrew hit short-term and long-term incentives. However, under the terms of the deal, the loan was to be fully repaid immediately in the event that Andrew was no longer employed with the company.
According to AMA, Andrew has not paid up.
As such, AMA has now gone to the Federal Court to recover the amount it believes it is owed by its former CEO.
AMA’s announcement was made after market close this afternoon, so it’s uncertain how shareholders will react to the Federal Court filing.
Shares in AMA closed a flat one per cent lower today at 50 cents each.
