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Friday 28 February 2020

20-050MR Pre-insolvency adviser imprisoned for money laundering

Former pre-insolvency adviser Stephen O’Neill has been sentenced at Brisbane District Court to five years in prison with a non-parole period of 22 months, after pleading guilty to one charge of dealing in the proceeds of crime.

In October 2014, Mr O’Neill, along with John Narramore of SME’s R Us Pty Ltd, advised Richard Ludwig, a former director of Cap Coast Telecoms Pty Ltd, to engage in activity that would involve the illegal removal of company assets to prevent creditors from accessing these assets (19-047MR).

Messrs O’Neill and Narramore issued fictitious invoices from companies under their control to Cap Coast Telecoms and arranged for $743,050 to be transferred from Cap Coast Telecoms’ bank accounts to the bank accounts of companies under their control. Messrs O’Neill and Narramore then transferred the funds to Ludwig or his associates.

Once funds had been transferred by Messrs O’Neill and Narramore, Cap Coast Telecoms was wound up on 19 January 2015. At the time, it owed creditors $2,955,128.

In delivering the sentence, Judge Rosengren found that O’Neill’s offences were of a serious nature, and that he carried them out for financial gain. Judge Rosengren found that O’Neill understood the criminality of the offences and that the transactions were made to defeat creditor interests and to undermine the liquidator.

Following sentencing, ASIC Commissioner John Price again emphasised ASIC’s commitment to ensuring creditors have access to company assets during insolvency proceedings.

‘Companies in financial distress trust advisors to provide sound and ethical advice,’ said Commissioner Price.

‘This outcome demonstrates that when pre-insolvency advisors provide illegal advice and facilitate criminal conduct, ASIC will act and the culprits will be jailed.’    

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

Background

The matter was referred to ASIC through an unfunded supplementary report by the liquidator of Cap Coast Telecoms, Mr Mark Hutchins of Cor Cordis.

On 3 October 2019, Mr O’Neill pleaded guilty to one breach of s400.4(2) of the Criminal Code Act (Cth) 1995 for intentionally dealing in proceeds of crime worth $100,000 or more.

Mr Narramore, who was also charged with dealing in the proceeds of crime, previously pleaded guilty and was sentenced to four and half years jail for his part in the criminal enterprise (19-307MR).

Mr Ludwig was charged with one count of intentionally dealing in proceeds of crime and 10 counts of breaching his directors’ duties. He appeared in the Brisbane District Court on 26 February 2020 for a plea hearing. The matter is ongoing.

Last updated: 02/03/2020 11:40