Joseph Gutnick slams press reports, says wife is ‘diamond’
Bankrupt former rich lister ‘Diamond’ Joe Gutnick has taken a swipe at the media after reports regarding his wife’s involvement in his companies following his bankruptcy, saying she is worth “millions” and is a “diamond”.
Mr Gutnick took the stand in the Federal Court on Thursday as public examinations of his bankrupt estate continue. His wife and son were examined earlier in the week.
“She is herself a very special gem, a diamond,” Joe Gutnick says of his wife.
“There were disgusting reports in the newspaper,” he said.
Earlier this week, the court heard that a company linked to the bankrupt mining magnate is paying his wife, Stera Gutnick, $285,000 a year to work “a few hours a day” as a trainee jewellery designer, while her husband earns just $45,000 a year to work full time.
“She’s worth a lot more than some $200,000, possibly millions,” he said.
“She is herself a very special gem, a diamond,” he added.
“The press projected her as if she does nothing and we’re paying her an exorbitant wage. My wage is a separate issue. My concern is how this was presented in the papers,” he said.
Mr Gutnick said after his bankruptcy last year his wife worked three to four hours in the office, attended high level meetings and had research the jewellery industry extensively.
Stera Gutnik at the Federal Court this week. Photo: Jason South
When asked what qualifications Mrs Gutnick had to be running the businesses while Mr Gutnick was bankrupt Mr Gutnick told the court: “She wears a diamond”.
Mr Gutnick also raised his plans to take defamation action over the stories.
He denied ever discussing with his wife any plans to put assets out of reach of creditors in the event he went bankrupt.
On Monday, lawyers for the bankruptcy trustees challenged Mrs Gutnick, and suggested the shuffling of directorships and her taking on the debt was part of a “broader plan to protect Joseph against bankruptcy”‘.
Philip Crutchfield QC, who was asking questions of Mr Gutnick on behalf of two major creditors to the former magnate’s bankrupt estates, the Indian Farmers Fertiliser Cooperative (IFFCO) and Kisan International Trading, told the court that on Monday Mrs Gutnick said her husband had discussed structuring his affairs to protect assets “in some fashion”.
Mr Gutnick said his discussions with Mrs Gutnick regarding his assets related to her desire that the couple invest in safer assets like real estate rather than speculative mining stocks.
He denied ever hiding assets from creditors.
“Over the years I ‘ve just followed the advice of my accountants and my lawyers about how my affairs have been put into place,” Mr Gutnick said.
Mr Gutnick entered bankruptcy last year after losing a court battle with his former business partner IFFCO and Kisan over a $54 million personal debt. His company Legend International Holdings owes IFFCO a further $15 million. With interest, IFFCO is owed a total of $73 million. Legend is now in liquidation.
As revealed by Fairfax Media last year, Mr Gutnick’s statement shows he owes his creditors $275 million and has only has assets of $16,087 in savings and a host of shareholdings that are valued at zero.
Some of Mr Gutnick’s debts are to relatives, including a $30.7 million debt to his wife Stera and more than $116 million in debts to three companies run by family members.
The examination continues.