Octaviar directors breached duties
Five former executives of Octaviar (previously known as MFS Group) have been found liable for breaching their directors' and officers' duties by the Supreme Court of Queensland.
This followed from an Australian Securities and Investments Commission (ASIC) civil action that alleged the senior executives misappropriated $143.5 million of unit holders' money to repay debts. Octaviar collapsed in 2008 owing $2.5 billion.
ASIC alleged the conduct involved falsifying and backdating company documents to justify the transactions.
The court found that Messers Michael Christodoulou King, Craig Robert White, David Mark Anderson, Guy Hutchings, and Marilyn Anne Watts "were the people closely and relevantly connected with the company and its actions. Their significant roles in the company also seem... to qualify them as its ‘high managerial agents".
Each of them was found to have acted dishonestly in their roles as officers.
ASIC commissioner, John Price, said: "Company officers, including directors, play a very important role as gatekeepers in Australia's financial system. In this case we saw individuals neglect their duty to act in the interest of their investors".
The matter has been adjourned until 24 June, 2016 and the court can order a maximum pecuniary penalty of $200,000 to be paid by each individual in respect of declarations of contravention.
Recommended for you
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
Having peaked at more than 40 per cent growth since the first M&A bid, Insignia Financial shares have returned to earth six months later as the company awaits a final decision from CC Capital.
