Dairy farmers owed millions while owners of collapsed National Dairy Products led lavish lifestyle.

By national rural and regional correspondent Dominique Schwartz and the National Reporting Team’s Alexandra Blucher.

Dairy farmers who are collectively owed millions of dollars have accused the owner of a collapsed Victorian milk broking business of funding his “lavish lifestyle” from the company accounts rather than paying them for their milk.

Gippsland dairy farmer Fiona Plant says her family is owed more than half a million dollars.

“It’s not good enough that someone has a luxury boat on the Gold Coast and can have expensive holidays, lives in a multi-million-dollar mansion and can’t even pay farmers for their milk,” she told 7.30.

But Antonio ‘Tony’ Esposito, the owner of National Dairy Products (NDP), which went into liquidation in late February, said he was the victim.

Mr Esposito has vehemently denied any wrongdoing, saying that any money he withdrew was rightfully his.

“That was repayment of loans that I put into the business. I put in a total of about $8 million and I took back about $3 million. We are still owed just under $5 million,” he said.

‘Our intention was to pay the farmers’

NDP owes creditors as much as $6.8 million according to liquidator Deloitte Australia, which is investigating the company for possible insolvent trading.

Mr Esposito said he was “devastated” by the collapse of NDP, which bought milk from about two dozen farmers and then sold it to food manufacturers.

He said he never intended to “rip any farmers off”, and that he was a victim of the price crash in the dairy market last year.

“Our intention was to pay them [the farmers] as much as we could and make them sustainable, and that was even at our loss,” Mr Esposito said.

But the liquidator has told creditors the company may have been trading insolvent for 11 months, from December 2015 — well before Murray Goulburn’s price cut, which sent the local market into turmoil.

Mr Esposito and his partner Violetta — who took over as the sole director of NDP in April 2016 — live in a multi-million-dollar mansion in Melbourne’s upmarket seaside suburb of Brighton, and lead a lifestyle of luxury cars, yachting holidays and expensive parties.

Documents obtained by 7.30, including internal emails and bank statements, show that Mr Esposito was receiving payments of tens of thousands of dollars while some farmers were not being paid.

Lavish $90,000 birthday party apparently paid out of company account

Just weeks before it started falling behind on farmer payments, NDP appeared to have paid for Mr Esposito's extravagant 50th birthday party held at the Plaza Ballroom in Melbourne on October 31, 2015.

7.30 has obtained an invoice made out to the company, which shows that the dairy company had paid $9,000 as a deposit and owed the remaining $81,000 for the party.

Mr Esposito said NDP "could" have paid for the party, but that if it did, it would have been in lieu of a loan repayment.

Speaking out for the first time against Mr Esposito, the former acting chief executive of NDP, Darryl Cardona, said that shortly after the party he began raising concerns that the company may have been trading insolvent.

"There was a shortfall of cash and we were unable to pay a supplier's total amount," Mr Cardona said.

"At that stage there was some money coming out of the business for personal expenses."

Mr Cardona is in a bitter dispute with Mr Esposito over whether Mr Cardona's family company loaned NDP half a million dollars.

$325,000 withdrawn in months leading up to collapse

Internal emails and company bank statements obtained by 7.30 show Mr Esposito withdrew $325,000 from the business over just four months between July and October 2016.

Again, the business owner said those transfers were repayments of a loan.

The ABC can reveal that the liquidator told creditors that the last remaining $20,000 in the company bank account was transferred to Mr Esposito just hours before he put NDP into administration.

Deloitte identified up to $4.3 million dollars in possible "voidable transactions", which the Espositos may be liable for.

In response to the $20,000 withdrawal, Mr Esposito said he could not recall the transfer but would give back the money if required.

He conceded that the business had performed poorly from the start in April 2015.

"We experienced two odd million dollars of losses in those [first] two months alone," he said.

Gippsland producer Alister Clyne, who is the brother of Fiona Plant, said he was owed $1.1 million, which makes him NDP's largest farmer creditor.

He said Mr Esposito should have paid farmers before repaying himself.

"He is looking after number one; I am speechless over some of his conduct," Mr Clyne said.

Mr Esposito also told 7.30 he planned to sell his Brighton mansion and one of his country properties to repay farmers.

However, he disputes the amounts they say they are owed.

Director's cousin paid $100,000 but acting CEO 'never met him'

Internal emails obtained by the ABC have also raised questions about salaries being paid to members of the Esposito family.

In March 2016, the company employed Violetta Esposito's Macedonian cousin as the Business Development Manager on a 457 visa.

Internal emails from a migration lawyer showed he was on a $100,000 per year salary, which made him exempt from an English test requirement of the visa.

Mr Cardona said he was confused about the role Ms Esposito's cousin played in the business, because he had never met him despite there being only nine staff.

"I know absolutely nothing about him," Mr Cardona said.

"You'd expect to meet and know your staff back to front and point them in the right direction."

Australian Border Force has threatened to take action against NDP because it failed to notify the agency of the company's voluntary administration, which could invalidate the 457 visa.

Mr Esposito said that his partner Violetta had almost no involvement in the company, despite being the sole director.

The liquidators are also investigating whether Mr Esposito was a shadow director — a claim he denies.

This post originally appeared on ABC News.