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15-370MR ASIC disqualifies Melbourne director
ASIC banned Mr John Stephen Paulding of Melbourne from managing corporations for five years following his involvement in the failure of three companies. The ban follows an ASIC investigation which found Mr Paulding breached his duties as a director.
Mr Paulding was the director of Paulding Constructions Pty Ltd ACN 052 834 661(Paulding Constructions) a construction company based in Victoria from 4th July 1991 until it went into liquidation on 30 November 2009. Mr Paulding was also the director of Port Phillip Property Group Pty Ltd ACN 077 002 656 and Kingtoun Pty Ltd ACN 104 845 356 which were both placed into liquidation in May 2010. The failures resulted in deficiencies owed to creditors across the three companies which totalled over $3.5 million.
ASIC found that Mr Paulding:
- Failed to exercise his duty to act in good faith in the best interest of Paulding Constructions or for a proper purpose
- On winding up Paulding Constructions did not produce books to its current liquidators as he was required to do
- Concealed and removed assets of Paulding Constructions so that they were not readily realisable by the current liquidators.
'The position of company director is a privilege that comes with certain responsibilities and when those responsibilities are breached, such as in this instance, ASIC will take steps to remove directors from managing companies.' ASIC Commissioner Greg Tanzer said.
The liquidator of Paulding Constructions received funding from ASIC via the Assetless Administration Fund to carry out public examinations and prepare a detailed report on its investigation into the company.
The five year period for which Mr Paulding was banned from managing corporations is the maximum period of disqualification that ASIC can impose under section 206F of the Corporations Act 2001. Section 206F of the Corporations Act 2001 allows ASIC to disqualify a person from managing corporations if, within a seven year period, the person was an officer of two or more companies, and those companies were wound up and a liquidator provides a report to ASIC that the company is unable to repay its debts.