Mr Andrew Ferguson, the former Chief Executive Officer of South Australian abalone farm Australian Bight Abalone (ABA) has been sentenced today in the District Court to 3 and a half years imprisonment, with a non-parole period of 12 months.

The sentencing follows an ASIC investigation which resulted in Mr Ferguson being charged with 17 counts of providing false and misleading information to the ABA Board of Directors and prospective investors.

On Friday 19 January 2018, Mr Ferguson was found guilty of all 17 charges, following a jury trial in the District Court of South Australia (Refer: 18-016MR).

In sentencing Mr Ferguson, Judge Boylan stated that Mr Ferguson’s offending was serious. “It extended over a period of nearly two years. It involved a breach of trust in your position as an officer of the company. It was motivated by greed. It was, in short, a sustained, repetitive and deliberate course of criminal conduct involving 17 separate occasions of deceitful conduct.”

ASIC Deputy Chair Peter Kell said, "Today's sentencing reflects both the severity of Mr Ferguson's actions and the consequences facing those who do not abide by the law. ASIC will continue to investigate where investors and board members are deceived, and refer criminal conduct to the CDPP for prosecution."

On 14 May 2018, the Court of Criminal Appeal granted Mr Ferguson permission to appeal against conviction. The date of the appeal hearing is 19 June 2018.

The Commonwealth Director of Public Prosecutions prosecuted the matter.

Background

ABA was Australia's largest off-shore abalone farmer, raising about $44 million from 1400 investors over four years.  ABA operated an abalone farm in off-shore cages located near Elliston in South Australia between 2005 and 2009. The company also operated managed investment schemes (MIS), through which investors acquired interests in abalone grown at the farm, entitling them to returns from the sale of harvested abalone.

The initial MIS project was offered to wholesale investors only in 2005, but a MIS was offered to retail investors in each subsequent year between 2006 and 2009.

Administrators (McGrath Nicol) were appointed to ABA in July 2009 after the company had been able to undertake only a limited harvest of the abalone stock. The Administrators reported that a survey conducted of the abalone stock at the farm suggested significantly higher mortality than had been expected.

Mr Ferguson pleaded not guilty to the charges against him.

Editor's note:

On 22 June 2018, Mr Ferguson filed a Notice to Appeal against sentence. The permission to appeal hearing is listed on 16 July 2018 at 10:00am at the Supreme Court.

Editor's note 2:

The permission to appeal hearing (against sentence) has been administratively adjourned to 30 July 2018 at 10.00am in the Supreme Court.

Editor's note 3:

Prior to the hearing on 30 July 2018, Mr Ferguson withdrew his appeal against sentence. On 5 December 2018 the Court of Criminal Appeal dismissed Mr Ferguson’s appeal against conviction.

Read the judgement here.