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11-41AD ASIC prosecutes 75 company officers
ASIC has successfully prosecuted 75 individuals between October and December 2010 for various Corporations Act 2001 (the Corporations Act) offences including failing to assist external administrators.
ASIC took this action following complaints from the public and insolvency practitioners. These prosecutions resulted in fines totaling over $90,000.
ASIC also referred three briefs to the Commonwealth Director of Public Prosecutions (CDPP) who successfully prosecuted directors for managing a company while disqualified.
Of the 75 directors prosecuted, 47 were from New South Wales, 19 were from Queensland, 5 were from Western Australia, 3 were from Victoria and 1was from South Australia.
‘Without a Report as to Affairs and a company’s books and records, liquidators can’t properly investigate the underlying causes of a company’s failure. This may impact on a liquidator’s ability to establish the true financial position of a company and to realise assets to satisfy creditor demands and employee entitlements,’ said ASIC Commissioner, Dr Peter Boxall.
‘Our work in this area demonstrates our focus on small to medium enterprise companies (SMEs) who are most vulnerable to changing economic climates, and therefore at greatest risk of failure. When an SME fails, it has a significant downstream impact on other SME creditors and employees. We are committed to holding those individuals who fail to assist external administrators of distressed companies accountable so that an orderly wind-up can be conducted,’ Dr Boxall added.
All 75 individuals were prosecuted before the Local and Magistrates’ Courts in New South Wales, Queensland, Victoria, South Australia and Western Australia. All were prosecuted for specific breaches of the Corporations Act.
Information about ASIC’s deterrence activities are contained in individual media releases, available from ASIC’s website.
Complaints regarding suspected breaches of the Corporations Act can be lodged with ASIC via our website or by writing to any of our capital city offices across Australia:
Misconduct & Breach Reporting
GPO Box 9827
IN YOUR CAPITAL CITY
On 9 March 2011, the original version of this media advisory incorrectly stated ASIC had successfully prosecuted 75 individuals between September and December 2010. This advisory should have read October and December 2010.