A couple of people, including Emma have posted to verify this in the news comments, so I apologise from the bottom of my bitter, cynical heart for raising the doubt.
Good luck to Emma and Craig.
EDIT : redacted
Anyone confirm or deny the following message I received after donating to the [url="http://www.sumea.com.au/snews.asp?news=1849"]"Donation for ex-Ratbags"[/url] ebay plea?
The ebay account certainly shows none of the telltale signs of being scammy. However, any ex 'baggers who can verify the story would probably be nice.
Original message removed.
Wow, I check Sumea after 4 months absents only find out that Midway closed down the Ratbag studio. Another blow for Australian game development. I hope all ex ratbag staff can find alternative employment and minimal family trouble because of it. Best Wishes.
I would suggest that these people get in contact with their countries consulate general as they can help out in cases like these.