The chairman of EML Payments, the prepaid cards business once...

The chairman of EML Payments, the prepaid cards business once worth $2 billion, spent more than $100,000 of the company’s money on personal expenses in just 12 months.Luke Bortoli, a former executive at buy now, pay later group Afterpay, has repaid the money, telling the company it had been approved by other directors.Luke Bortoli. `However, the board’s handling of Dr Bortoli’s credit card use has split the board. The company’s former interim chief executive, Kevin Murphy, now a director, claims the board was too slow to investigate the issue when he raised it in June.The draft of a shareholder letter and meeting notice authored by Mr Murphy, obtained by The Australian Financial Review, proposes removing Dr Bortoli and other directors.According to Mr Murphy – who was notified of the spending by the finance team when he was acting as chief executive – he raised concerns about the credit card use, and Herbert Smith Freehills and McGrathNicol were appointed to conduct a review.RELATED QUOTESEMLEML Payments$0.8600.001 year1 dayAug 23Nov 23Feb 24Aug 240.6000.8001.0001.2001.400Updated: Aug 15, 2024 – 6.53am. Data is 20 mins delayed.View EML related articles AdvertisementEMP Payments confirmed that it had undertaken an “independent review of expenses incurred by directors and management”. But a company spokesman said “the board had considered the review findings and is satisfied there has been no impropriety”.No further action would be taken, the spokesman said.EML Payments, now with a market capitalisation of just over $300 million, has been in turmoil for more than a year. Emma Shand quit as the company’s chief executive in April last year, after just 10 months, and the board decided to appoint Barrenjoey Capital Partners to sell “all or parts” of the business.That came months after regulators in London joined their Irish counterparts in investigating EML Payments’ business in the United Kingdom, sending the stock to a nine-year low. The Financial Conduct Authority has stopped EML from taking on new customers.The explanatory statement prepared by Mr Murphy and dated August 8 outlines in detail his concerns about the handling of the personal expenses.Dr Bortoli, who is also the chief financial officer of ASX-listed lithium miner Pilbara Minerals, said that the spending was allowed because two directors had told him he could use the card on personal expenses in lieu of additional directors’ fees.In the statement, Mr Murphy said he was concerned by how slowly the board moved to deal with the issue once he raised it. “This kind of ‘barter’ arrangement is not normal practice in Australian public company governance,” it reads.According to the documents authored by Mr Murphy, Dr Bortoli had also inadvertently charged personal expenses to the corporate card in previous years. He repaid those charges, including for flights between Sydney and Perth.Sources told the Financial Review that Dr Bortoli was being advised by Arnold Bloch Leibler; EML is represented by Allens. Neither Dr Bortoli nor Mr Murphy responded to questions. EML is due to report its full-year result on August 28.Dr Bortoli left Afterpay in June 2021 after just over three years, having been paid about $60 million in cash and share options. He joined the buy now, pay later group in May 2018, and worked for Aristocrat Leisure before that.EML Payments shareholders ousted chairman Peter Martin in 2022, blaming him for knocking back approaches from Bain Capital and Canada’s Nuvei Corp. Alta Fox Capital Management, an activist investor based in the United States, had acquired a substantial stake in EML Payments that year and helped vote down Mr Martin’s re-election.RELATEDFor this Rich Lister, does the reality live up to the hype?