"Collapse of Mosaic Brands hurts female factory workers in Bangladesh", 30 June 2025

Creditors owed more than $361 million are set to vote on the future of failed Australian retail giant Mosaic Brands, as Bangladeshi garment suppliers flag mass lay-offs as the result of millions in unpaid orders

Bangladeshi factory owner Jabed Ahmed faces debt of about $2.5 million after Mosaic...went into voluntary administration in October last year.

He told the ABC his company, Padma Satel Arab, had to fire about 500 workers as a result...

"Other [suppliers] have already closed down."

At least 23 factory owners in Bangladesh were owed a total of $30 million by Mosaic when the company went under...

Mosaic's administrators, FTI Consulting, have recommended the liquidation of Mosaic and its brands...

More than 4,000 Australian employees from over 600 stores across the country will be paid as a priority, according to Australian law.

Darren Vardy, director of Insolvency Options, which is representing the creditors, said factories and workers overseas were likely to get nothing.

Under the best-case scenario outlined in the report, they will get back 17.5 per cent of what they are owed...

Factory owners have been forced to sack workers and face mounting pressure from local banks after millions in orders went unpaid.

...about 40,000 workers are affected...

FTI Consulting's initial report to creditors said Mosaic Brands had likely been trading for years while insolvent.

This carries serious penalties under Australia's Corporations Act...

Any legal action over insolvent trading could hold some or all directors personally liable, forcing them to repay from their own pockets...

Bangladeshi factory owner Nafis Ud Doula, from Impress Newtex Textiles, said Mosaic had strung him along with new orders.

"They were tying us up with new orders just to get old payments," Mr Doula told the ABC.

"They bought a lot of product from us. They kept extending payment terms — from 90 days to 120, even 180 — and still didn't pay.

"They just kept saying, 'Don't worry, the payment is coming, just make this order,'" Mr Doula said.

Mosaic Brands did not reply to the ABC's requests for comment.

Former Mosaic director Scott Evans, who served from 2014 until early 2024, also did not respond to the ABC's inquiries...

Gazi Abdullah Al Mustafiz, merchandising manager of SMUG Sweater, is owed more than $2 million for garments already delivered or sitting idle on factory floors.

In Bangladesh's garment industry, factories rely on complex financing mechanisms tied to letters of credit that are needed for international trade payments.

When a brand like Mosaic places an order, suppliers buy fabric and raw materials using credit from local banks.

Those banks, in turn, continue collecting repayments on loans — regardless of whether the overseas buyer pays up...

Mosaic Brands invoked temporary safe harbour protections between March 25, 2020 and March 31, 2021 — introduced in response to the COVID-19 pandemic.

According to the administrators, Mosaic continued to rely on safe harbour...even after the pandemic.

FTI Consulting said it was "not clear" whether the company's directors met the legal criteria for protection "at all times" and said further investigation was required...

...NRN Knitting and Garments senior merchandiser Moin Uddin....said more than $3 million worth of garments had been shipped to Australia without payment, while finished stock sat in his warehouse...

...he is now struggling to pay [workers'] monthly wages...

Factory owners have sent a letter to the Australian High Commission in Bangladesh about what they are owed.

"It's not just business — it's people's lives," he said.