ASIC has accepted an enforceable undertaking (EU) from Adelaide-based registered liquidator, Anthony Christopher Matthews, of accounting firm, Anthony Matthews & Associates.
ASIC reviewed Mr Matthews’conduct as voluntary administrator of Sapphire (SA) Pty Ltd ACN 076 858 029 formerly trading as River City Grain Co. and formed the view that that he had failed to:
- identify possible insolvent trading claims against Sapphire’s holding company and/or ultimate holding company;
- investigate a deed of settlement compromising debts;
- investigate unrelated debts assigned for one cent in the dollar;
- investigate differences in the value of stock as at key dates; and
- investigate the attempted assignment of two sales contracts.
ASIC also found that Mr Matthews did not properly and adequately document his investigations, provide an adequate report to creditors and report possible director misconduct to ASIC.
The EU prevents Mr Matthews from accepting any new appointments for two months, with the exception of one matter where, prior to commencement of the EU, he had filed a consent to act with the Court.
The EU also requires Mr Matthews to appoint an independent expert at his own cost to review his insolvency practice. The expert will report to ASIC, and ASIC may publish the results of the reports.
Following ASIC's intervention, Mr Matthews has taken steps which include:
- undertaking public examinations of Sapphire’s director and other parties;
- updating practice systems and procedures, including investigation checklists; and
- engaging an external consultant to provide bi-monthly staff training sessions.
ASIC Commissioner John Price said, ‘Registered liquidators must fully meet their duty to creditors to adequately investigate and document investigations and report alleged offences to ASIC. This very much goes to ensuring confidence in the insolvency market and ASIC's supervision of that market.’
‘ASIC continues to work with practitioners to uphold the high standards the law imposes on them.’
ASIC acknowledges Mr Matthews' cooperation in resolving this matter.
Download the enforceable undertaking
Background
Sapphire traded in agricultural commodities (grains) domestically and overseas.
In March 2014, Mr Matthews was appointed as voluntary administrator of Sapphire. Sapphire ceased trading at the time of appointment with unsecured debts in excess of $10m.
In May 2014, creditors resolved to accept a Deed of Company Arrangement that proposed 20c in the dollar on ordinary unsecured debts.
Based on reports of misconduct, ASIC reviewed and investigated Mr Matthews' conduct concerning the administration of Sapphire.
In November 2015, Mr Matthews conducted examinations in the Federal Court of Sapphire's Director and other parties. ASIC continues to liaise with Mr Matthews regarding his administration of Sapphire.
Editor's note:
ASIC confirms that Mr Matthews has satisfactorily completed all of the terms of his EU.