Directors in familiar territory

By ALAN PERROTT

Two directors behind the failed Modern Age Institute of Learning were involved in another ill-fated education venture two years ago.

The multi-campus English language school went into voluntary liquidation at 9am yesterday after several weeks of fruitless negotiations to find new investors.

Its collapse sent shockwaves through export education, the country's fourth largest industry, and has left a trail of unpaid creditors, former staff and homestay families.

Three unsuspecting students arrived in Auckland on Monday, following one who arrived last week. All will have paid their tuition fees and homestay costs in advance, up to $30,240 for a 48-week course.

About half of Modern Age's 300 Auckland students were yesterday placed with other schools.

The institute's Christchurch campus has already been sold and investors are circling the school's five other sites in Auckland, Tauranga and Wellington.

Modern Age directors Anthony Kim and Adrian Gray have declined all requests for comment.

In May 2001, the pair attempted to establish another language school, at the Rocklands Hostel in Epsom.

At that time Modern Age had two campuses, in Tauranga and Newmarket, and was looking to expand.

A director involved in the Rocklands project said the top floor of a hostel was converted into classrooms, but the directors closed the school within two days of opening.

The man, who declined to be named, described Mr Gray, a former teacher, as an honourable man who appeared to be in over his head.

"He seemed a very pleasant, amiable man, but I think [the business] was probably a bit big for him."

A senior manager with Modern Age was angry the school continued to accept new enrolments despite knowing of their impending closure.

The manager said many of the institute's problems followed the purchase of their Hobson St campus in April. She claimed Mr Kim told staff it was done to protect the honour of its Korean owner and the greater Korean community and went ahead without due diligence.

Jeff Meltzer, the liquidator appointed by the Modern Age shareholders, said looking after the students was his first priority and he would not begin investigating the company's financial situation until tomorrow. An initial report to shareholders will be prepared on Friday.

Mr Meltzer could not confirm whether the school's trust fund, set up to safeguard student fees, remained intact.

Education Minister Trevor Mallard yesterday told Parliament that a New Zealand Qualifications Authority audit in February confirmed the money was in the appropriate accounts. A later audit in April, the time of the Hobson St purchase, found the money was gone.

Mr Mallard has said the Government will provide up to $500,000 to cover the students' future accommodation costs and any outstanding homestay costs from August that Modern Age's remaining funds are unable to meet.

He said the money would probably be recovered from CRELS, the group of private language schools with which Modern Age was associated.

The company:

Modern Age Institute of Learning Limited.

Incorporated in April 1987.

Former names: Modern Age Computer Training Ltd and Numero Twenty Three Ltd.

Directors:

(Anthony) Kim Duck Kyn:

35, from Albany, Auckland.

Also director of: Modern Age Institute of Learning (Hobson St); Modern Age Institute of Learning; Modern Age International Marketing; Modern Age (Rocklands Campus), struck off 2003; Modern Age Travel; Modern Age Institute of Learning Wellington.

Adrian Gray:

Mormon minister and former teacher from Tauranga.

Also director of: Modern Age Institute of Learning Wellington; Modern Age Institute of Learning (Hobson St); Modern Age Institute of Learning; Modern Age International Marketing; Modern Age (Rocklands Campus), struck off 2003; Modern Age Travel; Fitford Holdings, struck off in 2000; Modern Age Office Systems, struck off in 2000; Modern Age Advertising, struck off in 2000.