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ASIC lands $700k in financial reporting failure penalties

  •  
By Keith Ford
  •  
2 minute read

For the first half of 2023, the corporate regulator prosecuted 36 companies and secured more than $700,000 in penalties for reporting failures.

According to the Australian Securities and Investments Commission (ASIC), between 1 January 2023 and 30 June 2023, the prosecutions for failing to lodge financial reports, hold annual general meetings (AGMs) and to maintain the required number of directors and resident directors, netted in excess of $700,000.

Among the largest of these actions were three prosecutions that saw fines of more than $100,000 each, with the largest of which relating to asset management firm ALT Financial Group. The firm was fined $123,000 for failing to lodge annual reports and hold AGMs between 2018 and 2021, and for failing to maintain the minimum number of company directors.

“ASIC will continue to prosecute companies that are negligent in their reporting responsibilities aimed at assisting shareholders, creditors, and members of the public make informed decisions,” the regulator said at the time.

Corporate telecommunications company TV2U International had the second largest fine of the year so far. It was fined $110,000 for failing to lodge annual financial reports for the 2021 and 2022 financial years, half-year financial reports for 31 December 2020 and 2021, failing to report to members and hold an AGM in 2021, failing to have a company secretary, and failing to maintain the required number of directors and resident directors.

RMG, a resources exploration business, was also convicted and fined $105,000 for failing to lodge three annual financial reports between 2020 and 2022, a half-year financial report for 31 December 2020, failing to have a company secretary, and failing to maintain the required number of directors and resident directors.

ASIC said it also secured significant penalties against Adgex, which was fined $83,000 for failing to lodge reports or hold AGMs from 2019 to 2021 and maintain the required number of directors and resident directors.

ABM Group’s breaches made up a significant portion of the list, receiving a total of $69,000 in fines handed to 11 of its companies.

The majority of cases, however, resulted in fines of $10,000 or below, with 23 of the 36 penalties falling below this threshold, including 10 of the ABM Group breaches.

“Financial reports provide shareholders, creditors and the public with important information, enabling them to make informed decisions when dealing with these companies. It is crucial that disclosing entities lodge their financial reports in a timely manner,” ASIC said.