Kleenmaid online auction buyers safe, but customer anger grows

Customers who bought Kleenmaid appliances through an online auction on the day the company collapsed will receive their goods.

Last week, online auction site Gray’s Online ran an auction of Kleenmaid appliances, acting under instruction from the company. The auction finished at 7:30pm AEST on 9 April, just hours after Kleenmaid collapsed into administration with debts of $73 million.

But a spokesperson for Gray’s Online, Mark Keogh, says buyers are safe and the appliances will be dispatched later this week.

The Gray’s Online customers are the lucky ones. Across Australia, up to 6000 Kleenmaid customers are waiting to learn whether they will receive the goods they ordered or whether their deposits will be refunded. Customers are owed a total of $27 million.

In Melbourne yesterday, police were called to a Kleenmaid retail store in the suburb of Mitcham after the store owner became alarmed by a group of disgruntled customers banging on the door of the locked store.

Some customers said they had bought goods just days before the company went under and had been given steep discounts for paying in full.

Administrators from accounting firm Deloitte have closed down all stores while they attempt to unravel the mess, but administrator John Greig released a Q&A yesterday that presented a blunt message for customers – don’t hold your breath.

“All amounts paid by customers either as deposits or in full will be regarded as an unsecured creditor claim against the company. As such, the administrators are not able to have any goods delivered to any customers even though the amount may have been paid in full,” Greig said.

“Unfortunately, no refunds are able to be issued by the administrators. At the present time there is no cash available to pay any refunds. All customers who have paid for goods either partially or in full will be regarded as an unsecured creditor.

“They will shortly be receiving a letter explaining the next steps in the administration process with an invitation to attend the first creditor’s meeting in Brisbane.”

Greig also said all finished goods are sitting in a warehouse controlled by a third-party warehouse provider that is refusing to release the goods – even if they have been paid for in full.

Administrators and ASIC will also investigate the possibility Kleenmaid may have been trading while insolvent, and are set to examine the use of discounts and incentives to close sales in the final weeks of the company.

Meanwhile, Kleenmaid founder Andrew Young has admitted the company is six months behind in staff superannuation payments.

“I’m confident that’s not an isolated case that’s related to Kleenmaid alone,” he told the ABC.

“So that’s another cash pressure that’s been on the business, and certainly that is something that we’re unhappy to disclose, but unfortunately that’s the circumstances.”

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