Devan Lincoln has lost $8000 after buying a high-tech machine from a Kiwi company. Photo / Paul Taylor
Two years ago, a Hawke's Bay man paid $8000 online for a high-tech piece of machinery.
It never arrived.
When he tried to investigate a bit further Devan Lincoln realised quickly that he wasn't the only one left out of pocket.
South Island company Vertigo Technologies, which is now in liquidation, has left a trail of frustrated customers in its wake.
Its owner admits he made "mistakes" with the company, and says he is unsure if any of those owed money will see their products or deposits again.
Lincoln made an $8000 deposit in November 2019 to buy a CNC router - a computerised machine which cuts wood and soft metals - from Vertigo Technologies.
He has since learned the company failed to honour or refund 40 orders taken during 2019 and late 2018, totalling about $275,000.
The company then finally went into voluntary liquidation in May.
Lincoln said the thing that frustrated him the most was Vertigo Technologies took his order when it was already struggling and unable to honour orders.
"I think they were trying to get out of trouble by taking more orders but not being able to supply the orders they already had."
Lincoln said he wanted others to be wary when making purchases online.
"I just want people to know this is happening in New Zealand.
"It is hard because I took out so much money - I took out a loan to pay for it and am still paying [back that loan] for something I never received," he said.
"What they were selling looked very staunch and so nice, and one of the reasons I bought it from a New Zealand company was to support Kiwis."
He said other affected clients started a Facebook group and one client contacted a lawyer, which led to Vertigo Technologies being placed in liquidation this year.
Vertigo Technologies founder Brett Cottle spoke to Hawke's Bay Today and said he "did make mistakes" looking back.
He said he was now unsure how the clients would ever receive their money back.
"I hope it can happen but I'm unsure how," he said. "I didn't think that it would end up the way that it has."
He said the company started brightly in 2016 on the West Coast but things started going downhill in 2018 when they lost staff and decided to shift to Christchurch.
He said at that stage they were selling about 80 machines a year.
"We weren't able to meet the deadlines that we promised to customers at the time and I ended up employing more staff than we needed, and that got us into financial trouble," he said.
"Along with the fact that we were selling the product and making a loss, there was so much we didn't factor with moving to Christchurch."
Eventually, the business stopped taking orders in December 2019.
Cottle said money from 47 previous orders - totalling about $300,000 - was spent on "staffing overheads and stock" without the actual machines being built.
"When you are paying staff and paying for all the parts and importing things from China ... it does not take long to churn through that."
He said he had a mental breakdown in late 2019 at the height of those problems.
He claimed he came up with an agreement with a new director, who agreed to continue building the machines under a different brand on the condition he helped clear the backlog of orders.
"There were about seven or eight backlog machines that were delivered (during 2020)."
However, that halted during the Covid pandemic and about 40 orders were still yet to be honoured.
Now the company has entered liquidation it is unlikely that will ever happen.
"I am more than willing to volunteer my time to build those machines (in future)."
However, much of the equipment needed to build the machines has now been sold by the liquidator, according to Cottle.
Brenton Hunt, from Insolvency Matters Limited, has been appointed as the liquidator. Hunt has been contacted for comment.
A liquidator's report stated the company owed creditors an estimated $700,000 including about $275,000 to IRD and $275,000 to customers who had paid deposits.