Mr Sam Grace, a Sydney based company director, has pleaded guilty and was convicted of contravening section 1308(2) of the Corporations Act 2001  for lodging a document with ASIC that contained a false or misleading statement.

Mr Grace was convicted and given a recognizance release order of $500 to be of good behaviour for twelve months.

ASIC found that Mr Grace signed and lodged 'ASIC Form 6010 – Application for voluntary deregistration of a company', to deregister Grace Enterprises (NSW) Pty Ltd, declaring that the company was not a party to ongoing legal proceedings.

ASIC's investigation found that Mr Grace's declaration was false, because at the time the document was lodged, Grace Enterprises (NSW) Pty Ltd was a party to proceedings in the New South Wales Civil and Administrative Tribunal.

The matter was heard in Downing Centre Local Court on 8 November 2016.  As a result of the conviction, Mr Grace is automatically disqualified from managing corporations until 8 November 2021.

‘Directors that lodge documents with ASIC have an obligation to ensure that the information they provide is correct, said ASIC Commissioner Greg Tanzer.

‘Where a director deregisters a company knowing it is party to ongoing legal proceeding, it unfairly prejudices another person’s legal rights. Where a director fails to act honestly ASIC will hold those directors personally accountable by taking strong enforcement action,' Mr Tanzer said.

The matter was prosecuted by the Commonwealth Director of Public Prosecutions.

Background

Section 601AA of the Corporations Act 2001 stipulates that a person can apply to deregister a company only if the company is not party to any legal proceedings.