Hundreds of people and small businesses collectively owed more than $22 million from a Canberra construction firm that went bust have been told they may not receive a cent back.
Banyan Constructions went into liquidation in January and had debts to more than 260 creditors, some were owed in excess of $1 million.
Many of those owed money were subcontractors and small family businesses.
The estimated return to unsecured creditors was "nil" based on preliminary investigations in a report sent to creditors by liquidators Ernst and Young. It is uncertain whether a divided would be paid to any class of creditor in the liquidation.
Investigations into the company showed money troubles started in the 2017 financial year where it recorded a loss of more than $2 million.
In the 2018 financial year Banyan reported a profit of $2 million but by the end of the following financial year the company had lost $16 million.
This ballooned to more than $21 million before the company folded in January.
At the time of liquidation, Banyan Constructions was building townhouses in Watson, Macquarie and Greenway, among other projects.
Liam Kelly was the sole director of Banyan Constructions at the time of liquidation. Calls to Mr Kelly's mobile number are redirected to an automated message which says the service has been disconnected.
Master Builders ACT chief executive Michael Hopkins said Banyan's directors should be "fully accountable" to corporations and building laws.
"The release of the Banyan Constructions statutory report will be sobering reading for any of the local subcontractors and suppliers that are owed money from this company," he said.
"Because of the actions of Banyan Constructions, many local subbies and suppliers will be even more vulnerable to the likely downturn resulting from the COVID-19 crisis.
"Targeted government support for those business will be needed to help them survive the next six months."
It came as the latest Australian Bureau of Statistics figures showed a 3.4 per cent decline in construction activity in the ACT since the COVID-19 pandemic.
Seventy-three per cent of respondents to a Master Builders ACT survey of its members said they had received a "substantial" fall.
Mr Hopkins called for targeted government support for businesses to help them survive the duration of the pandemic.
"Governments must act now because while many builders are getting by on work that commenced prior to the onset of COVID-19, that work is fast running out and new orders have reduced," he said.
"While we commend the ACT Government on their current efforts to support the industry, we're calling on them to continue to keep the industry working by increasing expenditure on capital works projects.
"It's vital that we protect the livelihoods of the almost 20,000 Canberrans that are employed in the building and construction industry."
