You should refer to relevant sections of Corporations Act 2001 (Cth) and any relevant precedents.

Sev and Jane are directors Kleen Solutions LTD (KSL). KSL experienced significant financial issues throughout 2018. They have lost a large contract and have been told that their major supplier will no longer extend credit to the company. Likewise, many other suppliers became nervous and placed the company on a strict COD basis. The directors started to get numerous calls from creditors wanting to know when the company would be paying them back. The directors started to pay the more aggressive creditors while putting off others but soon cheques started to bounce.

Knowing that the company was doomed, in January of 2019, Sev transferred the last $100,000 in the companys bank account to a major supplier as he felt sorry for them and thought it deserved something back. He also took three company laptops, two company phones and $10,000 in cash from the company safe as he thought the company owed him something for all his hard work in running the company.

In February 2019, the directors had no alternative but to place KSL into voluntary administration and it was subsequently placed into liquidation.

Required:

Advise the liquidator;

1. About any action that can be taken against the directors for breaches of section 588G. (5 marks)