The regulator found significant governance and oversight failures in managing three companies
ASIC has disqualified a Perth businessman from managing corporations for four years following his involvement in the failure of three land development companies between 2005 and 2017.
ASIC found significant governance and oversight failures in the management of the three companies. One of the businesses failed to lodge a 2015 tax return and did not maintain proper business records. Another did not register for essential tax identifiers, failed to submit tax returns from 2011 to 2013, underreported land sales revenue, and provided inconsistent information about development costs. The third company made unsupported tax deduction claims between 2009 and 2012 and failed to maintain adequate records.
The director provided a signed assurance to ASIC, promising to resign from certain corporate positions, but this did not occur. ASIC determined this to be a false representation, which further supported the disqualification. In addition, ASIC's decision considered a prior conviction for failing to assist the liquidator in the winding-up process of two of the companies.
Reports from the appointed liquidator played a central role in the disqualification process. These reports detailed the companies’ financial difficulties and inability to pay debts. ASIC provided funding through the Assetless Administration Fund to assist the liquidator in preparing supplementary reports, which were critical in establishing the extent of the governance failures.
The disqualified individual sought a review of the decision through the Administrative Review Tribunal. Alongside the review application, the businessman requested a stay order to delay the disqualification and prevent ASIC from issuing a media release. The tribunal refused the stay order, but the substantive review of the disqualification remains ongoing.
ASIC’s decision was made under s. 206F of the Corporations Act, which allows the regulator to disqualify individuals who have been officers of two or more companies wound up within seven years and deemed unable to pay their debts.
