Excerpts

The warning lights were flashing for giant childcare operator G8 Education.

It had an unorthodox $26 million deal on the line to sell centres to Genius Education, a venture whose subsequent collapse would strand staff and parents, and whose boss Darren Misquitta would later plead guilty to receiving suspected proceeds of crime unconnected to the child care industry.

Despite G8 knowing about problems, an ABC investigation can reveal how the childcare giant downplayed concerns and maintained it had conducted checks.

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G8 is Australia's biggest for-profit operator, running almost 400 centres under brands including Bambino's and Kindy Patch Kids. The ASX-listed company, valued at almost $600 million, is among big corporates in a sector that was, until the early 2000s, more a cottage industry.

A hodgepodge amalgamation of childcare businesses, G8 owned 175 centres by 2012. Its annual report that year featured a giggling infant wearing thick black glasses, with the company crowing operations were going from "strength to strength". It kept growing.

But earnings see-sawed between losses of $189 million in 2020 to profits of $68 million in 2024. Investors savaged shares this year after a former staffer was charged with child abuse.

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Worried staff even stocked up on extra supplies such as nappies while G8 remained owner.

After the transfer, wages were late on the first payday. Then long-planned fixes, such as of fencing and sandpits, also stopped, she said.

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