$16M of RADs missing as 60 residents told Chronos Care homes to close next month

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Two Melbourne aged care homes founded by bankrupt brothers Chris and Gerry Apostolatos will shut, with a liquidator unable to account for more than $16 million in Refundable Accommodation Deposits (RADs) made by residents or their families.

Around 60 residents will have to find alternative accommodation and about 130 employees at Chronos Care in Alphington, 7km northeast of Melbourne’s CBD, and the bayside suburb Mount Eliza, 50km from Melbourne’s CBD, are also owed almost $1 million in entitlements and will need to find new employment when both facilities close on 28 January next year.

Chronos Care’s owner Mali Nominees had just $71 in the bank when it was placed in administration on 30 July, according to a report by liquidator PCI Partners, which has reportedly identified several potential breaches of prudential regulations and director’s duties, including a claim the business was insolvent at least six months before managing director Rita Kohu put it into administration.

Ms Kohu is the step-daughter of Gerry Apostolatos, who founded Chronos Care with his brother Chris in 2014, when both men were bankrupt with combined debts of more than $5 million.

Attempts by the liquidator to sell the aged care homes allegedly failed as interested buyers were unwilling to take on the liability of having to repay the $16 million of RADs.

RADs are guaranteed by the Federal Government – so if the money doesn’t turn up, the Commonwealth will be liable to repaying the residents’ deposits.