2001 Media and information releases
01/420b ASIC annual report: Victoria
Thursday 29 November 2001
The Victorian office of the Australian Securities and Investments Commission (ASIC) had a busy year enforcing the Corporations Act, protecting investors and consumers, and ensuring that companies make prompt disclosure to the market, as outlined in ASIC's Annual Report 2000/2001 tabled yesterday in Federal Parliament.
ASIC's Regional Commissioner Mark Drysdale said that the year had some clear themes.
'We have placed heavy emphasis on enforcing the law, on ensuring adequate disclosure in prospectuses and other fundraising documents, and on monitoring the behaviour of financial advisers and insurance brokers as the industry prepares for the implementation of the Financial Services Reform Act', Mr Drysdale said.
Victoria enforcement action
ASIC's Victorian office commenced 63 new investigations during the financial year. Charges were laid in 12 criminal matters and ASIC took civil action in relation to 25 other matters.
As a result of action by ASIC, the courts jailed 10 Victorians, including:
- George Cormack, who defrauded three clients of $195,000 and was sentenced to four years and nine months jail;
- Accountant Ross Patrick Zagari, who received a sentence of three years, six months jail for illegally redeemed $2.5 million in superannuation benefits and defrauding the Tax Office;
- Wayne Clifford McNamara, who cheated clients of more than $70,000 and was sentenced to two years jail. On appeal this sentence was reduced to 23 months suspended on the condition that he attend home detention for eight months and enter a good behaviour bond;
- Mark Stuart Crosling, who dishonestly drew more than $675,000 in cheques from his company and was sentenced to two years jail with a minimum of 12 months; and
- Michael Taylor, who misappropriated over $380,000. Mr Taylor received a sentence of two years jail, to be released after three months on a good behaviour bond.
'Dishonest or incompetent financial advisors and insurance brokers do great damage to investors and to the reputation of the industry, and we are pleased that in several cases the actions of rogue employees were initially reported to us by the principals or compliance officers of the financial services companies involved', Mr Drysdale said.
In June 2001, Darren Kingsley Brown, James Bernard McDonnell and Ian Thomas Campbell Westcott, the three former directors of futures trading company Lateral Trading Ltd, pleaded guilty to a range of ASIC charges.
ASIC's Victorian office has several major matters still before the courts, including civil penalty proceedings in the Victorian Supreme Court against three former directors of Water Wheel Holdings Ltd and action against MYOB Ltd over the accounting treatment of their assets.
Prospectuses and disclosure
In March 2000 changes to the fundraising provisions of the Corporations Law came into effect. ASIC no longer registers prospectuses prior to their public circulation, but still issues stop orders on prospectuses that do not meet the required standards.
The Victorian office was highly active in issuing stop orders and in forcing companies to include additional disclosure, with 31 companies' fundraising documents affected and ASIC enquiries leading to five trading halts placed on listed entities by the ASX.
Other disclosure highlights during the year included the significant additional disclosure achieved from several large listed companies.
At different stages, ASIC had concerns about the BHP/Billiton Dual Listing Explanatory Memorandum, and about the market's understanding of the true financial position of Austrim Nylex. Following ASIC action, both companies made significant additional disclosure to the market.
Financial services
ASIC's Victorian office has been active in raising industry standards in the lead-up to the implementation of the Financial Services Reform legislation.
Actions have included prosecuting and deregistering insurance brokers and the first conviction under the Superannuation Industry Supervision (SIS) Act, of Ross Patrick Zagari.
The office also took action against promoters of share trading software and took court action against Share Trend and MINT Enterprises.
For further information contact:
Mark Drysdale
Regional Commissioner, Victoria
Telephone: 03 9280 3696
Mobile: 0411 549 021 | Felicity Glennie-Holmes
ASIC Media Unit
Telephone: 02 9911 2600
Mobile: 0412 673 038 |
End of release
ASIC Website: Printed 07/31/2010
