Ex-director of collapsed Cap Coast Telecoms Richard Ludwig sentenced to five years jail for money laundering

By on
Ex-director of collapsed Cap Coast Telecoms Richard Ludwig sentenced to five years jail for money laundering

The former director of the now-collapsed Queensland-based Cap Coast Telecoms, Richard Ludwig, has been sentenced to five years imprisonment for money laundering.

Cap Coast Telecoms was an operator of multiple Queensland-based Leading Edge Telecoms retail stores, which filed for liquidation in 2015 owing just under $3 million to creditors.

In early November, Ludwig admitted to hiding company assets to prevent creditors from accessing them, pleading guilty to intentionally dealing with the proceeds of crime and 10 counts of breaching directors’ duties.

The District Court of Queensland imposed a five year prison sentence to Ludwig, with a non-parole period of 20 months, when he faced the court Thursday.

The sentencing was announced by the Australian Securities and Investments Commission (ASIC), who uncovered the scheme and charged Ludwig in 2019.

“A critical duty of company directors is to ensure creditor debts are properly paid. Not only did Ludwig fail in this duty, he actively sought to dishonestly avoid these obligations, and denied funds to creditors to which they should have had access,” ASIC deputy chair Sarah Court said.

“Directors’ duties are serious obligations which must be complied with. When directors knowingly breach their duties, this case demonstrates they risk significant jail time.”

The money laundering operation was orchestrated while Ludwig was still running Cap Coast Telecoms, following the advice given by Stephen O’Neill and John Narramore of pre-insolvency firm “SME’s R Us” to resolve a dispute with a creditor.

ASIC said O’Neill and Narramore helped Ludwig stash away some $743,050 of company funds by issuing fictitious invoices from companies under their control to Cap Coast Telecoms between October 2014 and January 2015. The company was liquidated soon after, with debts of $2,955,128.

Narramore was sentenced in November 2019 to a four and a half year prison sentence, while O’Neill was sentenced to five years in February 2020.

Cap Coast Telecoms was the holding company of Leading Edge Telecoms stores in Yeppoon, Rockhampton, Gracemere, Gladstone City and Emerald. Leading Edge Telecoms, which was part of the Leading Edge Buying Group, was a major Telstra dealer before it closed down in 2016.

Got a news tip for our journalists? Share it with us anonymously here.
Copyright © CRN Australia. All rights reserved.

Most Read Articles

Log In

  |  Forgot your password?