Richard Kennaway, right, and Kristi Solanius, are the couple behind concrete company Zeb Ltd. Photo: Stuff
He's left a trail of creditors from three failed concrete companies, faced accusations of wage theft from migrant workers and been told he can no longer direct a company: but that hasn't stopped Richard Kennaway doing business.
The Ministry of Business, Employment and Innovation (MBIE) will investigate if the Cambridge businessman is breaching a seven-year ban on running a company after a complaint from a former business associate.
Glenn Elliott, director of drainage contractors Clarks Pipes, was shocked to read Stuff reporting of how Kennaway had allegedly exploited migrant workers. He then discovered Kennaway was banned from running a company after three of his businesses were liquidated.
But little seems to have changed for Richard Kennaway: he's still selling concrete products from the same factory in Pokeno, Waikato.
Elliott struck a contract with a company called Zeb Ltd in April, a month before Kennaway's ban. Kennaway did the negotiations and signed the deal, but the company's sole director is Kristi Solanius, a chiropractor and masseur.
Solanius lives with Kennaway at the same $1.2m rural lifestyle block in Cambridge. Companies records say Zeb is trading as "Spanit", a trading name used by Kennaway in previous enterprises. Elliott has never dealt with Solanius.
"It's distressing to learn that someone you trusted and wanted to support in business turns out to be a serial migrant exploiter," Elliott said. "And then I find out that he is a banned director as well."
In a phone conversation between Elliott and Kennaway's longstanding offsider, factory manager Beiji 'Joe' Zhou, which Stuff has heard, Zhou says: "Richard makes the decisions."
He talks of Kennaway completing one major project and starting another. He also talks of how Kennaway is the employer of their Chinese labour and is his employer as well: "I work for Richard ... Richard is the employer of these guys from overseas".
Elliott also provided a default notice signed by Kennaway on behalf of Zeb from July 14 - two months after his ban began - when the companies were in dispute over a contract.
He also has a diary note written by his general manager after a meeting with Kennaway and Zhou on July 19. It records how Kennaway upbraided Zhou during their meeting over work he considered substandard, and handled negotiations and decisions on pricing.
"It was very evident that the whole process there was being run by Richard. He clearly called the shots on manufacturing and sales."
Kennaway has also made part-payment of a settlement agreed with former workers - a deal he and Zhou agreed to be personally responsible for - from a bank account linked to Zeb Ltd.
When Stuff phoned Kennaway and asked if he was acting as a director of Zeb in breach of his suspension, he said: "No. And I have nothing to say to you." He then hung up. He declined to respond to a subsequent text message detailing the allegations against him.
In a statement, Vanessa Cook, MBIE Investigation and Enforcement manager, said: ''If Mr Kennaway is acting as a manager of Zeb (and undertaking the activities as specified) it is something we would investigate."
Under the Companies Act, anyone found guilty of acting as a director when banned is liable to a penalty of up to five years' imprisonment and a fine of $200,000. The notice banning Kennaway said it included "being a director or promoter of, or being concerned in or taking part, whether directly or indirectly, in the management of any company".
Cook said Kennaway was banned because the Registrar was satisfied he took part in the management of two failed companies within five years and "their mismanagement was wholly or partly responsible for the failure of those companies". Those failures were Precast Ltd and Superspan Ltd.
Company records show a trail of destruction behind Kennaway.
The first domino to tumble was Precast Ltd, liquidated on August 31, 2020. Liquidators' reports list claims of $1.702m from 16 unsecured creditors, $64,390 from Inland Revenue as preferential creditors, and one secured creditor owed $52,067.
The liquidators' report said Kennaway had been uncooperative, and a creditors' committee had met and raised concerns at his "reckless" running of the company, but while the liquidator wanted to explore litigation against him, the creditors were unwilling to fund it.
Superspan Ltd was liquidated on September 14, 2020. Liquidators' reports from the Official Assignee, Tony Lowe, say Kennaway had promised to make an offer to settle debts, but none was forthcoming and Kennaway had been issued a summons for an interview. Lowe's report said the liquidator was assessing if he had breached directors' duty and whether to pursue legal action and had referred him to the Companies Office Integrity and Enforcement team. Reports recorded unsecured creditors owed $202,716 and IRD owed $279,442.
Cook said the Official Assignee was "still assessing the merits of different causes of action to pursue Mr Kennaway personally to recover money owed to creditors".
Alan Spilhaus, general manager of haulage company Tom Ryan Cartage, initiated the liquidation over a debt of $7,759.63, of which some was paid after he served a statutory demand. He said it was the first time he'd taken such action in a 43-year career.
"Seven grand is not a lot, but it is the principle of the matter," he said. "I've had a other creditors contact us to say ... they had the same kind of problems."
He said Kennaway had failed to communicate and front up over the debt.
"Any business can fall on to hard times, but it is how we deal with those challenges ... if you keep trucking, and borrowing from Peter and Paul..."
Asked what he would think if Kennaway was again operating under another name, he said: "There are some operators who play by the ethical rules a little bit more loosely."
Most recently, Portalspan Buildings was liquidated by creditors on October 19, 2022, owing IRD $183,376 and related parties some $328,285 (Precast and Superspan). It recorded as an asset what appears to be an inter-company loan: "Zeb Ltd, $134,495."
Stuff has previously reported on allegations of migrant exploitation in Kennaway's businesses.
Yu spoke up about his exploitation – and was sacked from his job at a concrete factory. Photo: Stuff / David White
In 2021, a worker named 'Yu' spoke anonymously but was recognised by his employer, summoned to a meeting where he was criticised for speaking out, then later sacked.
An overstayer, Yu had worked up to 120 hours a week for $20 an hour cash and was owed back wages and holiday pay. He believes he was owed at least $4,000 but most likely more. Yu had never seen any tax statements.
Yu was originally employed by Precast, then after its liquidation was paid by a new company, Concrete Ltd, but said he had the same role and duties in the same factory. Concrete Ltd, solely owned by Kennaway, was listed as a company from September 2020 to March 2021 when it was removed after Kennaway stated it had never operated.
Last year, Kennaway told Stuff that Yu was dismissed because he had no visa and "wasn't working well" but couldn't answer why it took him two years to realise Yu was an illegal worker. He said Yu's long hours were "none of your business".
Kennaway also faced Employment Relations Authority action from four former Chinese workers who claimed they were owed $40,000 in unpaid wages.
All had also complained to the Labour Inspectorate, who closed an investigation into the company despite finding multiple breaches of record-keeping laws.
Kennaway and Zhou agreed a settlement with the men, but it is understood they have not maintained their payments. Those payments they did make came from an account named 'Zen Ltd' (no such company exists) with a reference of '"Zeb Ltd laboursettle".
The men's advocate, May Moncur, is now pursuing a compliance order and a $20,000 penalty at the Employment Relations Authority.
One of the four, Gao Litong, earlier told Stuff he would work up to 120 hours a week. "Those times were the worst," he said. Litong was paid both before and after Precast's liquidation from an account named 'PRECAST BUIL' and said his work didn't change after the liquidation.
"The failure to comply with the settlement agreement is extremely upsetting and frustrating," Moncur said.
"We are disappointed by their failure to comply with the agreement. It's already been more than three and a half years [since the case began] and it has caused extreme and unnecessary stress and harm on these migrant workers and made their experience in New Zealand continue to be negative."
* This story originally appeared on Stuff.
