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Tuesday 20 December 2016

16-451MR ASIC disqualifies incompetent director from managing companies for maximum five year period

Mr George Nassar, of Revesby, NSW, has been disqualified by ASIC from managing companies for the maximum period of five years arising from  his involvement in eighteen failed companies. 

ASIC found that Mr Nassar failed to ensure that proper financial records were kept, failed to assist the liquidators of the eighteen companies after the companies had been wound up in and in some cases it appeared he had failed to ensure superannuation was paid.

ASIC was also concerned that Mr Nassar allowed himself to be appointed to a large number of companies that were already in financial difficulty and allowed them to continue incurring liabilities causing an ongoing risk to creditors, consumers and investors.  As a consequence it appeared that Mr Nassar failed to exercise his duties as a director with due care and diligence or in the best interests of each company or for a proper purpose.

In making its decision to disqualify Mr Nassar, ASIC relied on reports lodged by liquidators of the failed companies.

ASIC Deputy Chairman Peter Kell said, 'Directors have a legal and ethical obligation to act in good faith and in the best interest of the companies they are entrusted to manage. 

'ASIC will act to disqualify anyone who fails to meet these responsibilities, without regard to the impact on creditors', he said.

Mr Nassar's took effect from 6 December 2016 and extends to 6 December 2021.

Mr Nassar has the right to appeal to the Administrative Appeals Tribunal for a review of ASIC's decision. 

Background

Section 206F of the Corporations Act allows ASIC to disqualify a person from managing corporations for up to five years 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 about the company’s inability to pay its debts.

ASIC also maintains a 'Banned and Disqualified Persons' register that provides information about people who have been:

  • disqualified from involvement in the management of a corporation,
  • disqualified from auditing self-managed superannuation funds (SMSFs), or
  • disqualified from practising in the financial services of credit industry.

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Last updated: 20/12/2016 12:00