Sphere Insurance Group creditors will meet with the liquidator later this month as inquiries continue into the collapse of the authorised representative network.

A creditors’ update says the liquidator has taken Federal Court action to freeze assets and gain information after finding on appointment that a client money trust account showed a balance of $44.15.

The balance later increased to $6344 after a payment made before the appointment was returned to the account.

“My preliminary investigations have identified a number of transactions warranting further investigation,” liquidator Tracy Lee Knight says in the update.

“These include transactions from the company’s trust account of a nature that appear inconsistent with its purpose and function.”

The transactions include a deposit paid to a real estate agent, short-term financing arrangements, repayments of those loans shortly before the liquidator’s appointment, and other transactions that may require more examination to determine “whether they were for the benefit” of Sphere director Peter Robert Lionel Marten or other parties.

Last Monday, the Federal Court issued a freezing order on Mr Marten’s assets up to an unencumbered value of $4.5 million.

A hearing last Thursday adjourned a summons for examination addressed to Mr Marten to a date to be fixed. If it is not resumed within six months it will be deemed to be concluded. Summonses for examination addressed to four other individuals were discharged.

Formal proof of debt and informal claims related to Sphere, headquartered in Mount Lofty, Queensland, totalled about $11.7 million as of July 30, the liquidator’s progress report says.

“For the avoidance of doubt, the matters referred to in this circular are preliminary in nature,” the liquidator says. “No final findings have been made, and the purpose of the ongoing investigations and public examinations is to obtain further information before any conclusions are reached regarding potential claims or recoveries.”

A formal creditors’ meeting is scheduled for August 17, when the liquidator will provide an update, request authorisation to engage law firm Thomsons to potentially begin proceedings, and seek remuneration approval.

Ms Knight, from WCT Insolvency and Restructuring, was appointed the Sphere liquidator on June 5.

Inquiry activity has included meeting with major creditors, Mr Marten and others associated with Sphere, and engaging with the Australian Securities and Investments Commission on preliminary findings.

Mr Marten declined to comment when contacted by insuranceNEWS.com.au.