But We Are Bamboo director Colin Salisbury has rejected the liquidators’ suggestion that he breached his legal duties, despite leaving hundreds of customers out of pocket by thousands of dollars.
Affected customers have shared their frustration at the news, saying all of Salisbury’s assets should be seized until they were paid back.
The Lower Hutt-based ethical travel company, run by Salisbury and his colleague Mark Foster-Murray, announced in late October 2022 it was closing, blaming the failure of the business partly on Covid-19.
The company enabled customers to book international holiday packages which included a portion of time spent volunteering in local communities, as a way for travellers to give back to the places they visited.
When asked by some customers whether they would be refunded the thousands of dollars already prepaid for future holidays, the company told them via email they would not be receiving refunds, invoking the "force majeure" section of their terms and conditions. Most of the customers were from the United States, Britain, Canada, and Australia.
Earlier this year, BDO NZ liquidators revealed in a report that the company’s closure occurred after Salisbury put more than US$2 million ($3.24m) of customer funds into multiple cryptocurrency platforms from October 2020 until mid-2022.
While most of the money was lost due to poor trading decisions, about US$800,000 was lost because Salisbury put it into fraudulent platforms which simply "ceased to exist".
It was previously reported that all the money was lost, but in the latest report BDO revealed two "undisclosed" crypto platforms had been discovered during their investigation, containing $11,143 worth of cryptocurrencies.
"When queried with the director, it appears these platforms had been overlooked in our previous correspondence and the director subsequently transferred the balance to the Liquidators’ trust account as requested," the report said.
BDO has received 1193 claims against the company, totalling more than $4.2m. The average claim is for $3557.
The report said the investigation had been "difficult and time intensive", partly due to Salisbury’s use of crypto withdrawal platforms which were "unsophisticated" and did not provide a reliable, traceable transaction history.
"The primary objective of these investigations has been to determine whether there are any recoverable assets that remain as a result of the cryptocurrency purchases and trading that have either gone undisclosed or overlooked. It is our opinion that this remains inconclusive, although this investigation is still ongoing."
As well as possible asset recovery, BDO is looking at two methods of retrieving some of the money. This includes a possible "claw back" of payments made to Salisbury, which could be possible under the Companies Act 1993. BDO is also looking into whether Salisbury breached his director’s duties under the Act.
"Absent any significant new information, a resolution through one or both of these causes of action will be the only avenue for a meaningful distribution to creditors."
BDO formally wrote to Salisbury, demanding $781,187.
"The director, via their solicitor, rejected the assertions from the liquidators, including the suggestion that the director has breached their duties for the investment strategy in cryptocurrency that ultimately cost the company over $3m.
"The liquidators met with their solicitors to consider the points raised and intend to respond once further investigations have taken place."
The report did not include the full details of these investigations.
One affected customer, Terri Rogers, said she believed Salisbury should be held accountable and have all his assets seized "until he pays his debts".
"He had no qualms about us innocent travellers."
Another customer, Robyn Neal, said she had previously had an "amazing" trip to Tahiti booked through Bamboo.
"I trusted these guys and they ruined my trusting side . . . I feel pain for the guide and hosts who opened their hearts to all," she said.
"Colin and the rest should make everyone whole."
Jacqueline Wood said the "ultimate insult" was that Bamboo tried to partly blame its customers for the closure.
The Herald has attempted to contact Salisbury through various emails, phone numbers, social media and visits to his home, but he has not responded to requests for comment.
