An investigation into collapsed restaurant chain Criniti’s has found the company owes more than $6.5million to its former employees.
The fallen Italian restaurant empire also has $4.5million missing from its books, forensic accountants at Worrells claim.
The investigation comes after six Criniti’s eateries were closed when the business went into administration on November 19, with debts of more than $16.5million.
The chain’s other seven restaurants shut on April 3, due to the coronavirus pandemic, having earlier switched to takeaway to comply with government restrictions.
Investigators have now found shortfalls within the company, including staff being underpaid for long periods, unpaid superannuation, long service leave and annual leave.
The Italian restaurants across Australia went into voluntary administration in November with debts of $16.5million. Pictured: Bachelor star Noni Janur at the one of the Criniti’s restaurants
An investigation into collapsed restaurant chain Criniti’s has found the company owes more than $6.5 million to its former employees
The chain, which began in 2003, was famous for its wood-fire pizzas and attracted a number of high-flying customers
The company also failed to pay staff for the final two weeks the restaurants were open, the Daily Telegraph reported.
Worrells previously found the company had been trading insolvent since December 1, 2018.
The $6.651 million owed to employees will likely be paid out from the taxpayer-funded Fair Entitlements Guarantee scheme, but they will only receive it if they are eligible.
The missing money, which could help pay back staff, disappeared between December 1, 2018 and November 18, 2019.
Investigators calculated $4.5 million was missing was discovering there was disparity between what went through store tills compared to what was banked.
There was varying amounts missing from different stores. In Woolloomooloo $21,000 was missing, whereas in Darling Harbour there was a whopping $935,000 missing.
Investigators listed the missing funds as ‘Unfair Director Related Benefits’.
‘We are investigating whether the Director and/or his family have received cash from the Company and other Companies in the group,’investigators said.
The heavily-tattooed Frank Criniti has kept a low public profile despite the onetime success of the Criniti’s restaurant chain. TV presenter Erin Molan is pictured with Italian soccer star Fabio Cannavaro (middle) and Frank’s brother Dominic Criniti
Italian motorcycles and sports car adorn Criniti’s restaurants. The chain once provided a Rolls Royce Phantom to ferry diners to and from its Woolloomooloo Wharf eatery
There was hope the restaurants could reopen but when the $6.1 million buyout deal fell through, creditors voted to throw in the towel on resurrection efforts.
Worrells had campaigned extensively to sell what was left of the business and received plenty of interest before the pandemic foiled their plans.
Instead the restaurants will be sold for parts in a now inevitable liquidation.
The chain, founded in 2003, was managed by Frank Criniti and his wife Rima until they divorced in 2009 and he was left in charge.
Frank was disqualified from managing companies for five years in 2018 due to his involvement in seven other failed businesses.
The chain’s sudden collapse came as a shock to industry rivals, but people who had dined there said it ‘didn’t surprise them at all’.
Italian restaurant chain Criniti’s will shut down for good after coronavirus killed off a sale agreement to rescue it. Pictured: Bachelor star Noni Janur at the restaurant
Rima Criniti handed sole ownership of the pizza-pasta franchise to her now ex-husband Frank and his relatives in 2009.
Rima said the Criniti clan made several errors which included accumulated debts and rapid expansion.
‘While I left the business almost a decade ago, I have continued to dine at Criniti’s with my children, and have always loved the food and the experience,’ Rima wrote in a statement.
‘However, it takes more than fantastic food and hospitality to make a restaurant group a success.
‘It also requires smart management. There are very high costs involved in the hospitality industry, and if this is met with poor business decisions, then the business, its staff, and customers, will all suffer – as we now see with Criniti’s.’