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ASIC Advisory 11-302: NSW tax consultant pleads guilty to insider trading

by Desanka.Vukelich 15. December 2011 15:58

11–302AD NSW tax consultant pleads guilty to insider trading

Thursday 15 December 2011

Former PricewaterhouseCoopers (PwC) senior consultant, Nicholas Glynatsis, has today pleaded guilty in Sydney’s Downing Centre Local Court to nine charges of insider trading following an ASIC investigation.

Mr Glynatsis, of Russell Lea, Sydney, was a PwC employee between February 2007 and January 2011.

ASIC alleges that between 20 November 2009 and 23 November 2010, Mr Glynatsis acquired securities and contracts for difference (CFDs) in his name and the names of two relatives ahead of eight corporate transactions, including six takeover bids, on which PwC was engaged to provide advice. Total profits from the trading amounted to approximately $50,000.

ASIC alleges that at the time Mr Glynatsis acquired the relevant securities and CFDs, he possessed inside information that he acquired through internal PwC databases holding confidential client information.

The alleged insider trading was identified by ASIC’s Market Surveillance team in September 2010 and referred to ASIC’s Market Integrity Deterrence team for investigation and enforcement action.

Mr Glynatsis is to appear before the Supreme Court on 3 February 2012 for arraignment. The Commonwealth Director of Public Prosecutions is prosecuting the matter.

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ASIC

Insolvency Law Bulletin, Vol 12 Issue 4: Agony Aunt's advice

by Desanka.Vukelich 15. December 2011 11:51

The latest issue of the LexisNexis Insolvency Law Bulletin includes a very insightful Agony Aunt column on PPSA issues. Thank you to subscribers who have given us positive feedback. We hope you enjoy it.

...

SEEKING PERFECTION

Dear Aunty

I am an ordinary suburban lender and have been going out with my borrower for two years now. When we first started dating things between us were great — I felt safe every time he’d draw down my facility, charging his assets and registering extreme satisfaction. But he hasn’t asked me to marry him and I am worried about the level of his commitment. He doesn’t seem to have his priorities right and he laughs when I tell him I need more security.

Am I wrong to press him for more? Am I seeking perfection? Do you think I should give him another 24 months or so grace?

Yours

Worried, Baulkham Hills NSW

>>>

Dear Worried of Baulkham Hills

We’d all love to have our security perfected, but most of us have to live with something less. At least you’ve got possession by the sound of things, and if your borrower wants to retain title to his independence for a little longer, I’d say you should live with it for a while and hope that eventually the two of you achieve accession.

Getting married is all very well, but remember that a strong relationship depends on more than a piece of chattel paper. While your concerns are understandable, maybe you should invest more time in structuring a robust security agreement. After that you can head down to the new Register office together and then ITSA done deal!

...

IS HE A PIMSI?

Dear Aunty

Until recently my love life has been the typical flighty string of serial number lovers that our generation is famous for. It was fine for a while even though I got a bit of a reputation as a circulating asset. But I had started to feel that these unperfected security interests were leaving a void. Then I met the most amazing guy. I made him the priority of my advances and even tried collateral means to get him to engage in some serious commingling. However, even though he says he finds me attractive, I can’t seem to register the full extent of my interest. I’m worried that I may be doing something wrong.

Do you think he might be a PIMSI, and that I’m just not ticking the right box? Please answer and I’ll be forever in your debt.

Yours

Damaged Collateral, Collingwood, Vic

>>>

Dear Collateral

First of all, let’s cut out this “damaged” business. You need to understand that you are a worthwhile individual, and the mere fact that you’ve been a circulating asset for a few years with no fixed attachments doesn’t make you any less attractive than you’d otherwise be. One day, you’ll find that everything will come right, and from that moment of crystallization onwards, you’ll feel like you are being continuously perfected.

In the meantime, though, maybe you just need to take things a little slower. It’s not all about control, you know. Remember, many of these new-age PIMSIs are sensitive types, unlike the rotters of the old days, and it is absolutely essential to read them carefully. Mind you, that doesn’t mean they’re not vain — they still like you to make a point of recognising they’re PIMSIs, so make sure you find time to tell him — and remember, in this digital age with all the social media available to us, you can even do it electronically on a standard form.

...

TALKING DIRTY

Dear Aunty

If she knew I was writing to you she’d get really mad, but I’m worried about how to talk to my girlfriend about our personal property. She has just got out of law school and seems to speak a completely different language from me. I just get embarrassed with all this talk of control and possession, but she just takes it for granted. I’m worried I may not be able to perform to her expectations and that my PI premiums will skyrocket. Can you suggest how I can deal with my situation?

Sincerely,

Bewildered of Mosman Park, WA

>>>

Dear Bewildered

Don’t worry — if you do, your performance anxiety will only get worse. Find somewhere private (like a darkened closet, or the bathtub) and try repeating some key words or phrases to yourself over and over again. If you do, you’ll soon find yourself comfortable with expressions such as “intermediated security” and “migrated security interest”. However, once you overcome your feeling that some of these words are dirty, you should take care not to bandy them about too much. It’s one thing to drop the odd one into a dinner conversation, signaling that you’re ready to go the moment the system goes live — but if you throw them about too obviously she might think you’re trying to impress all the girls.

 

 

 

 

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Insolvency Law Bulletin | Personal Property Securities in Australia

ASIC Advisory 11-296: Former Gunns chairman charged with insider trading

by Desanka.Vukelich 14. December 2011 12:18

11-296AD Former Gunns chairman charged with insider trading

Tuesday 13 December 2011

Former Gunns Limited (Gunns) chairman, John Eugene Gay appeared in the Court of Petty Sessions in Launceston today charged with two counts of insider trading, following an ASIC investigation.

The matter was adjourned until 14 February 2012. Mr Gay will be required to enter a plea at this time.

Mr Gay was a director of Gunns Limited from 1980 to 2010 and was chairman of Gunns Limited from 2002 to 2010.

ASIC alleges that on December 2 and 4, 2009, while in possession of inside information relating to the financial performance of Gunns, Mr Gay sold more than 3.4 million Gunns shares. This trading was prior to the release of Gunns’ half year results on 22 February, 2010. Following this release, the Gunns share price fell substantially.

ASIC alleges Mr Gay possessed information that he knew or ought to have known was not generally available at the time of the sale, and if the information had been generally available, a reasonable person would expect it to have a material effect on the price or value of the shares.

The matter was referred to ASIC by the Australian Securities Exchange, before ASIC assumed responsibility for market supervision.

The Commonwealth Director of Public Prosecutions is prosecuting the matter.

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ASIC

Risk Management Today, Issues 15 & 16 now available on LexisNexis Online

by Desanka.Vukelich 8. December 2011 17:00

Issues 15 and 16 (November and December 2011) of the Risk Management Today newsletter offer the following articles:

  • ‘Demystifying risk: Issues v risks’, by Harry Rosenthal, Regis & Partners Pty Ltd
  • ‘Tax and risk – build a bridge and get over it!’, by David Drummond, KPMG Corporate Tax
  • ‘Rugby World Cup 2011 – the game of risk management’, by Samantha Ford, Adarna Consulting
  • ‘Reducing your employees’ and contractors’ risks on the road’, by Ian Luff, Motivation Australia Pty Ltd

The expert panel also reviews the year that was:

  • ‘ISO 31000 – still misquoted and misunderstood’, Jean Cross, UNSW
  • ‘When risk paradigms collide – the dark heart of our troubled PPPs’, by Christine Lithgow, Contracts Australia
  • ‘Failing to keep pace with change – the biggest risk of all’, by Todd Davies, Todd Davies and Associates
  • ‘2011: On the road to global disaster?’, by Dr Carl A Gibson and Susan Furness, La Trobe University

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Risk Management Today

ASIC Advisory 11-285: Appeal on sentence upheld for John Hartman

by Desanka.Vukelich 8. December 2011 10:55

11-285AD Appeal on sentence upheld for John Hartman

Wednesday 7 December 2011

The New South Wales Court of Criminal Appeal today upheld the appeal of Mr John Joseph Hartman against the severity of a sentence imposed on him last year for insider trading and tipping offences.

On 2 December 2010, Mr Hartman was sentenced to four years and six months imprisonment with a non-parole period of three years after pleading guilty to 19 insider trading charges and six tipping charges brought by ASIC. The offences were committed while Mr Hartman was employed by Orion Asset Management Limited as its equities dealer.

The Court of Criminal Appeal re-sentenced Mr Hartman to an overall term of three years imprisonment with a single pre-release period of 15 months. Mr Hartman must enter into a recognisance to observe and comply with conditions set by the court upon his release.

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ASIC

Australian Banking & Finance Law Bulletin, Vol 27 Issue 5 now available on LexisNexis Online

by Desanka.Vukelich 8. December 2011 10:08

Issue 5, Volume 27 of the Australian Banking & Finance Law Bulletin includes the following:

  • In Brief: David Richardson of HWL Ebsworth Lawyers summarises the William Co-Buchong v Citigroup Pty Ltd case
  • Amanda Bull of Thynne & Macartney asks, ‘Fixtures and the PPSA 2009: fuzzy logic?’
  • Graeme Howatson of Clayton Utz presents stage two of the ‘Future of financial advice’
  • And Anthony Lo Surdo SC, Barrister, introduces new books

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Australian Banking and Finance Law Bulletin

Insolvency Law Bulletin, Vol 12 Issue 4 now available on LexisNexis Online

by Desanka.Vukelich 8. December 2011 10:00

 

Issue 4, Volume 12 of the Insolvency Law Bulletin contains the following articles:

  • The Editorial Panel wraps up 2011 with ‘Year in Review’, and ‘The Eye on Insolvency’ also focuses on the events of the year
  • Paul B Lewis of the Center for International Law, The John Marshall Law School, Chicago, examines the American approach to executor contracts of intellectual property in the US
  • David Richardson of HWL Ebsworth Lawyers and Anthony Lo Surdo SC of Wentworth/Selborne Chambers offer a digest of the Re Colorado Group Ltd case
  • A letter to the editor broaches the subject of the ATO’s treatment of insolvent taxpayers
  • David Brown of Adelaide Law School and Monika Gajic of Finlaysons give us ‘PPSA Part 2 – Key implications for leases, other “deemed security interests” and liens’
  • And the PPSA Agony Aunt throws light on some knotty questions

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Insolvency | Insolvency Law Bulletin

ASIC Advisory 11-280: ASIC reaches eighth Westpoint settlement

by Desanka.Vukelich 2. December 2011 15:32

11-280AD ASIC reaches eighth Westpoint settlement

Friday 2 December 2011


ASIC has reached a settlement of its Federal Court proceeding against Queensland-based financial services firm, Strategic Joint Partners Pty Ltd (SJP).

The settlement concerns a claim for compensation on behalf of SJP clients (Group Members) who invested in the failed Westpoint Group of companies and is one of eight obtained by ASIC. If approved by the Court, SJP clients will receive over $1.39 million in compensation.

The settlement was reached without any admission of liability by SJP.

In March 2008, ASIC commenced proceedings against SJP following concerns the firm had been negligent and had breached the conditions of its Australian financial services licence in providing advice to its clients.

On 1 December 2011, the Court made orders for ASIC to communicate with all Group Members, providing details of the compensation they will likely receive and providing them with an opportunity to object to the settlement.

The process for approval of the settlement will include:

  • writing to Group Members, providing details of the compensation they will receive and giving them the opportunity to lodge with the Court any objection to the settlement
  • the Court considering the submissions of ASIC (and SJP) and any Group Member as to why the settlement should or should not be approved, and
  • the distribution of compensation to Group Members by ASIC if the settlement is approved (following a period to allow for any appeals).


After Group Members have had time to consider their position, ASIC will file a further application seeking final Court approval of the settlement. The Court has agreed to hear the application for final approval on 23 December 2011.

Background


The investors in Westpoint-related financial products had an outstanding total capital invested of $388 million as at January 2006 when the Group collapsed. Since November 2007, ASIC has launched 19 civil actions seeking to recover funds for investors in the majority of the Westpoint companies, including:

  • a claim against KPMG, the former auditors of the Westpoint Group
  • claims against the directors of nine Westpoint mezzanine companies and various entities associated with a director
  • claims against seven financial planners, and
  • a claim against State Trustees Limited.


To date, ASIC has successfully settled claims against: certain directors of the Westpoint group of companies and KPMG ($57 million); Masu Financial Management Pty Ltd; Professional Investment Services Pty Ltd ($5.9 million); Bongiorno Financial Advisers Pty Ltd and Bongiorno Financial Advisers (Aust) Ltd ($2.6 million); State Trustees Ltd ($13.5 million), Dukes Financial Services Pty Ltd and Joseph Dukes ($1 million) and Glenhurst Corporation Pty Ltd ($2.5 million).

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ASIC

ASIC Advisory 11-279: ASIC review: EDR schemes handling of complaints when members commence debt recovery legal proceedings

by Desanka.Vukelich 2. December 2011 15:21

11-279AD ASIC review: EDR schemes handling of complaints when members commence debt recovery legal proceedings

Friday 2 December 2011


ASIC today released a consultation paper to commence its review of external dispute resolution (EDR) jurisdiction over consumer complaints in cases where members have commenced legal proceedings to recover debts from consumers: Consultation Paper 172: Review: EDR jurisdiction over complaints when members commence debt recovery proceedings (CP 172).

The review seeks feedback on whether ASIC should refine its policy settings in Regulatory Guide 139 Approval and oversight of external dispute resolution schemes (RG 139) and fulfils a commitment ASIC undertook when it approved the Financial Ombudsman Service Limited’s (FOS) Terms of Reference in December 2009 to review the existing requirements in RG 139.

The policy settings under review, as outlined in RG 139.77-RG 139.79, require both EDR schemes - FOS and the Credit Ombudsman Service Limited (COSL) - to handle complaints under their Terms of Reference or Rules where members have commenced debt recovery legal proceedings. This must cover proceedings that are in their early stages, but need not cover those that have progressed beyond the complainant lodging a defence or defence and counterclaim.

This jurisdiction is primarily intended to assist complainants in hardship, especially those who may have taken out credit or margin lending products. However, it also applies where providers of other financial products have commenced debt recovery legal proceedings (i.e. insurance, investments and payment systems-related products).

ASIC Commissioner, Mr Peter Kell, said, ‘This review will help ASIC assess whether the EDR framework is working efficiently and effectively, and is part of our key priority to ensure consumers have an avenue for complaining or seeking help when they may most need it.

‘We encourage feedback from consumers and their representative groups, industry, ASIC approved EDR-schemes and other interested stakeholders’, he said.

Comments on the consultation paper are due by Monday 27 February 2012.

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ASIC

Australian Insurance Law Bulletin, Vol 27 Issue 2

by Desanka.Vukelich 28. November 2011 11:15

Volume 27, Issue 2 of the Australian Insurance Law Bulletin is now available at LexisNexis Online.

In this issue, you will find the following articles:

  • ‘Domestic arbitrators required to make reasoned awards’, by Dr Andrew Lu OAM of Minter Ellison
  • ‘New uncertainty as to defence costs cover under D&O insurance’, by Rehana Box and Crystal Lawton of Blake Dawson
  • ‘Developments in proportionate liability’, by Ivan Griscti of Seven Wentworth
  • ‘The year that was – in some ways, insurers might prefer it wasn’t’, by Greg Pynt of Pynt and Partners, Perth

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Australian Insurance Law Bulletin



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