Bun Fight

"Collusion with the (ANZ) Bank to create financial duress; "Inducing the above financial distress in order to arrange a fire-sale of the business, causing financial catastrophe; "Controlling the sales, in collusion with the bank, thus increasing a bogus debt of around $1 million."

South Coast Register
March 30, 2007

Bun Fight
Adam Wright

Bakers Delight in battle over alleged fraud

YOU know what they say - if you can't stand the heat…Deanna de Leeuw has quite a battle on hands, but she can stand the heat, and she has no intention of getting out of the kitchen. Ms de Leeuw was the owner of Bakers Delight stores in Vincentia, Kiama and Shellharbour. On purchasing the Kiama store she questioned a major staff underpayment. Ms de Leeuw claims she was told by Bakers Delight management that it would not be in her interest to become involved. She did become involved on behalf of her junior staff and has since lost the three stores, her home, four investment properties and has a legal bill of $140,000. Since becoming public this week the battle between Ms de Leeuw and Bakers Delight has escalated and while it appears to be a classic David and Goliath tale there is still no chance that Ms de Leeuw will back down from the franchise giant.

It came to light on Tuesday when Member for Gilmore Joanna Gash revealed, in Federal Parliament allegations of fraudulent, intimidatory and arguably criminal conduct from Bakers Delight. Mrs. Gash said while it appeared there had been serious breaches of the Trade Practices Act, particularly in regard to unconscionable practices, she would also suggest that grounds existed where there may have been breaches of criminal law. "Very serious allegations have been raised and if Mrs. De Leeuw has been brought to a stage where she cannot be given her day in court because she has been sent to the wall by deceit and lies, then this government must intervene on behalf of all small businesses," Mrs. Gash said in Parliament". Those allegations include fraudulent accounting that reduced profitability; "Removal of any marketing and other support, based on a 'bogus' breach, while still requiring weekly payments of marketing and royalty fees; "Collusion with the (ANZ) Bank to create financial duress; "Inducing the above financial distress in order to arrange a fire-sale of the business, causing financial catastrophe; "Controlling the sales, in collusion with the bank, thus increasing a bogus debt of around $1 million." This has now escalated to its current level that is in excess of $1.35 million. "Overall current losses are in excess of $2 million." On the personal side, intimidation, threats, both physical and financial, condoned by the franchisor, are matters serious enough to be referred to the NSW police," Mrs. Gash said under parliamentary privilege.

Ms. de Leeuw said that a Bakers Delight representative informed her it was Bakers Delight's intention to bankrupt her. "We have lost everything," she said. "We went into business knowing there's always a risk but with the investment properties behind us we never would have foreseen facing bankruptcy, but we are. "Fortunately my husband is employed outside the bakery," she said. "This process is very expensive and explains why very few people have been able to do it. "It's great to have Jo Gash on our side. We went to her in May last year when the bank was trying to bankrupt us. "We thought we were out of options and asked Mrs. Gash to intervene. We were two days from bankruptcy when she stepped in. "If not for her we would not be here being able to continue. "Lawyers representing Ms. de Leeuw met with representatives of Bakers Delight in a conciliation meeting on Wednesday. However the conciliation was terminated and referred to the Industrial Relations Court for a hearing later this year. Mrs. Gash was meeting with representatives from Bakers Delight late yesterday.


Brought to you by WikidFranchise.org

Risks: Deanne de Leeuw, David and Goliath story, 1,001 ways to make your life miserable, Abuse inherent in modern franchising, Bank alerts franchisor of problem franchisee, Bank violates federal privacy laws, Bankruptcy, Bullying, Criminal charges, Deceit, Franchisee leader, Fraudster banker, Gosh, you’, Australia, 20070330 Bun Fight

Unless otherwise stated, the content of this page is licensed under Creative Commons Attribution-ShareAlike 3.0 License