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The Queensland Supreme Court had granted Bluhdorn Investments Pty Ltd leave to bring proceedings on behalf of Nero Financial Pty Ltd against its sole director, David Crook, as well as Luca Financial Pty Ltd, Laguna Business Lending Pty Ltd and Cynthia Crook.
In a judgment handed down on 12 October, Justice Freeburn found that the requirements for granting leave to bring action had been met, including that the proposed proceedings were brought in “good faith” and Nero Financial had a “legitimate legal as well as commercial interest in seeking to have the assets restored to the company”.
The claim alleged that Crook diverted nearly $2.4 million owed to Nero Financial into his own bank accounts and those of his wife and associated businesses.
It further alleged that he set up a competing brokerage, Laguna Business Lending, and transferred Nero Financial’s client database and files to the new business.
The claim also alleged that Luca Financial, which is owned equally by David Crook and Cynthia Crook, received commissions from a deal involving a Nero Financial client, and that Nero Financial money was used to pay legal costs linked to the proceedings.
The court did not determine whether the allegations were true but instead granted Bluhdorn Investments leave to bring proceedings on behalf of Nero Financial.
Alleged $2.4m diversion
Crook has been the sole director of Nero Financial since October 2021. The brokerage’s two shareholders are Bluhdorn Investments and Luca Financial, which is owned equally by Crook and his wife, Cynthia.
The proposed claim centred on allegations that nearly $2.4 million owed to Nero Financial was paid into accounts controlled by Crook or associated entities.
Nero Financial’s invoices directed payments into its Westpac account.
But on 18 June 2026, Erin Bluhdorn, the sole director of Bluhdorn Investments, allegedly found invoices issued in Nero Financial’s name directing payments into a different account belonging to Crook.
The judgment also referred to a January 2023 email in which Crook allegedly contacted a financier through Nero Financial’s shared inbox, asking for a commission to be paid into “a different account of Nero Financial” and attaching his own banking details.
Bank statements obtained under subpoena were cited in support of the claim that at least $2,390,925 owed to Nero Financial had been allegedly paid into accounts controlled by Crook or associated entities.
This included the alleged payments:
- $1.64 million into Crook’s Westpac account over four years.
- $253,336 into an account held by Crook and his wife, or by his wife alone.
- $361,659 into Luca Financial’s account.
- $105,604 into Crook’s UBank account.
- $29,700 into Laguna Business Lending’s account.
It’s also alleged that a further $260,813 was transferred from Nero Financial’s accounts into Crook’s account and Luca Financial’s account, while $40,000 was paid from Nero Financial’s account to the solicitors to pay for Crook’s defence in the proceedings.
Bluhdorn Investments further alleged that Crook continued taking money from Nero Financial’s account after giving an undertaking to the court on 8 July 2026.
It should be noted, however, that these figures and transactions form part of the allegations set out in the proposed claim and have not been finally determined by the court.
Competing brokerage and payments to director’s wife alleged
The proposed claim also concerned Laguna Business Lending, which the judgment described as a competing brokerage established by Crook around June 2026.
Bluhdorn Investments alleged that, while serving as Nero Financial’s sole director, Crook downloaded the company’s entire client database and client files, with records subsequently transferred to Laguna.
The claim also alleged that a client’s brokerage invoice was sent to Laguna as well.
The judgment noted that an email from Laguna described Crook as “our director ... who’s also the director of Nero”.
Separately, Bluhdorn Investments also alleged that Luca Financial invoiced a lender $405,000 in commissions for a transaction involving a Nero Financial client and received $334,837.
The proposed claim also raised questions about payslips in the name of Crook’s wife, Cynthia Crook, allegedly recording $154,000 in wages for the year to date.
Bluhdorn Investments alleged that she had never worked for Nero Financial and that the company’s payroll records showed no corresponding payment.
Crook disputed the payslip allegation, saying the records “were simply draft Xero payroll records addressed to Cynthia Rourke. Further, they were never issued and payments in relation to same were never paid to Cynthia Rourke”.
The court did not make final findings on these allegations.
Director cited breakdown in business relationship
In responding to the application, Crook attributed his decision to establish Laguna to an ongoing breakdown in his business relationship with Nicholas Bluhdorn.
In an affidavit, Crook cited the departure of an employee, the replacement of lead-generation, marketing and IT services previously provided by 2iC and/or Bluhdorn Group, and what he alleged were attempts by Nicholas Bluhdorn to discredit him, Nero Financial and his wider business network.
Crook also alleged that Nicholas Bluhdorn had sought to divert business away from Nero Financial to other finance companies and had approached staff in an effort to discredit him and the business.
Justice Freeburn said Crook’s response was “not really a direct contest as to the facts alleged”, but rather “an explanation as to why [he] took these steps”.
The judgment noted that it does not set out a comprehensive, allegation-by-allegation defence to the proposed fund-diversion claim.
Court said company’s interests extend beyond shareholder dispute
Bluhdorn Investments and Luca Financial each own half of Nero Financial, with Crook serving as its sole director. The relationship between the parties had deteriorated, and the judgment noted that oppression proceedings were already under way between the two sides.
The respondents argued that the existing proceedings could provide a way to resolve the shareholder dispute, including through orders concerning the valuation and purchase of shares.
However, Justice Freeburn said Nero Financial’s interests were distinct from those of its shareholders.
“If the central case to be prosecuted by Nero Financial is that a director of that company has wrongly misappropriated the company’s assets to himself, and to others,” he said, “then the company has a legitimate legal as well as commercial interest in seeking to have the assets restored to the company.”
The judge also found that Bluhdorn Investments had demonstrated good faith by providing evidence supporting its proposed claim, preparing draft proceedings and offering undertakings concerning the costs of the litigation.
The court therefore granted leave for Bluhdorn Investments to bring proceedings in Nero Financial’s name against Crook, Luca Financial, Laguna Business Lending and Cynthia Crook.
The order is conditional on Bluhdorn Investments filing specified written undertakings within seven days. Justice Freeburn said the parties would be heard separately on costs and appropriate case-management orders.
[Related: Brokerage fined for ‘exploitation of vulnerable workers’]
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