Just weeks after launching a high-profiled case against executives and directors of property group Centro, the Australian Securities and Investment Commission has taken aim at a group of executives from collapsed financial services group MFS.
The corporate watchdog has launched civil action in the Queensland Supreme Court against the former chief executive of MFS, Michael King, former deputy chief executive Craig White, former chief financial officer David Anderson and two former MFS fund managers, Guy Hutchings and Marilyn Watts.
ASIC alleges that in November and December 2007, $147.5 million was transferred out of a MFS-controlled fund called Premium Income Fund and was used to pay debts in other parts of MFS’s crumbling empire.
“ASIC further alleges that in about January 2008, officers and the fund manager of MFSIM created and used false documents, relating to the use of the $147.5 million,” the watchdog said in a statement.
ASIC is seeking pecuniary penalties, compensation and bans preventing the former executives from managing companies in the future.
MFS, which changed its name to Octaviar in early 2008, finally collapsed in September 2008 and racked up debts of more than $1 billion.
The Premium Investment Fund is now managed by Wellington Capital, which first raised allegations regarding the $147.5 million loss in June 2008.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
