Melbourne director receives four-year ban from ASIC
A former director of fund manager Sovereign MF has been banned from providing financial services for four years.
According to an investigation by the Australian Securities and Investments Commission (ASIC), Michael Grochowski had failed to exercise the degree of care and diligence expected of a person in his position when he served as a director and officer of Sovereign between 12 May 2003 and March 2010.
ASIC stated that he lacked an understanding of the obligations imposed on Australian financial services licensees and failed to ensure all assets of the Sovereign Aged Care Property Fund were properly identified and registered as assets, resulting in the subsequent loss of property assets.
He also failed to adequately address defective disclosure documents - some of which did not contain information about a material change to circumstances affecting property assets of the fund.
In addition, Grochowski did not provide timely ongoing disclosure about material changes to circumstances affecting property assets, nor did he lodge annual financial reports for Sovereign and the fund, ASIC said.
He has the right to appeal to the Administrative Appeals Tribunal to seek a review of the banning, the regulator stated.
In 2010, the directors of Sovereign, including Grochowski, resigned and sold all shares in the company. New directors were appointed to Sovereign in March 2010 and the company continues to hold an AFS licence authorising it to operate its registered managed investment.
While Sovereign is currently addressing compliance issues in relation to conduct prior to the appointment of the new directors, ASIC is not pursuing any action against Sovereign or its current directors in relation to these issues.
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