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Thursday 23 December 2021

21-367MR Sydney director disqualified from managing corporations for four years

Jin Song Cui (also known as Jinsong Cui) of Forestville, NSW has been disqualified from managing companies for four years for his involvement in six failed companies.

Between 2012 and 2018, Mr Cui was a director of six companies:

  • Arise Construction Pty Ltd (ACN 155 727 512),
  • Gondon HLHS Epping Pty Ltd (ACN 609 101 635),
  • Gondon Five Pty Ltd (ACN 156 206 692),
  • Gondon Seven Pty Ltd (ACN 614 046 409),
  • Gondon Eight Pty Ltd (ACN 619 512 195), and
  • Gondon Nine Pty Ltd (ACN 619 756 160).

Arise Construction, Gondon HLHS Epping, Gondon Five and Gondon Seven operated in the construction and property development industry. 

ASIC found that Mr Cui:

  • improperly used his powers as a director to gain an advantage for himself, or someone else, or cause detriment to Arise Construction and Gondon Five in allowing company funds and assets to be transferred to, or used for the benefit of himself and family members;
  • failed to prevent Arise Construction, Gondon Five and Gondon HLHS Epping from incurring debts while they were insolvent;
  • failed to ensure that the liabilities across the six companies could be met and that debts and taxes were paid;
  • failed to exercise his powers and discharge his duties with due care and diligence in that he did not ensure that Arise Construction and Gondon Five complied with their statutory obligations to lodge tax documents;
  • failed to ensure that Arise Construction, Gondon HLHS Epping and Gondon Five maintained adequate books and records;
  • failed to deliver company books and records to the liquidators of Arise Construction, Gondon Five and Gondon HLHS Epping; and
  • failed to give the liquidator of Arise Construction and Gondon Five information about the business, property, affairs and financial circumstances of those companies.

At the time of ASIC’s decision, the six companies owed unsecured creditors $182,348,109, including $16,131,440 owed to the ATO.

In deciding to disqualify Mr Cui, ASIC relied on supplementary reports lodged by the liquidators of Arise Construction, Gondon Five and Gondon HLHS. ASIC assisted the liquidators of Arise Construction, Gondon Five and Gondon HLHS to prepare supplementary reports by providing funding from the Assetless Administration Fund.

Mr Cui is disqualified from managing corporations until 29 November 2025.

Background

Section 206F of the Corporations Act gives ASIC the power to disqualify a person from managing corporations for a maximum period of five years if, within a seven-year period, the person was an officer of two or more companies, and those companies were wound up and a liquidator provides a report to ASIC about each company’s inability to pay its debts.

ASIC also maintains a banned and disqualified persons register that provides information about people who have been disqualified from:

  • involvement in the management of a corporation;
  • auditing self-managed superannuation funds (SMSFs); or
  • practising in the financial services or credit industry.
Last updated: 23/12/2021 12:00