Showing posts with label ASIC. Show all posts
Showing posts with label ASIC. Show all posts

Wednesday, 27 September 2017

Australian Politics in 2017: Financial Fog Unlimited #2

The Byzantine financial arrangements of yet another member of the Liberal Party of Australia…..

The Age, 14 September 2017:

The father of Turnbull government MP Stuart Robert says he was unaware he was a director of a private investment company that held shares in his son's IT service business which has won tens of millions of dollars worth of government contracts.

Alan Robert, 80, has also told Fairfax Media that the private investment company, Robert International, was run by his son during the six-year period he and his wife, Dorothy, were the company's only directors. It is a revelation that would link the Queensland MP with the IT services business, GMT Group, at a time when Stuart Robert claims to have "ceased involvement" in GMT.

The Sydney Morning Herald, 13 September 2017:

Mr Robert only resigned his directorships and offloaded his shares in his GMT Group in 2010 – three years after he was first elected to Parliament. The Queensland MP told Fairfax Media he structured his affairs in a way that did not breach the rules, but has refused to provide any evidence to support this claim.

But Fairfax Media has uncovered fresh details about Mr Robert's connection to the GMT Group, an IT service company he co-founded prior to his political career.

Mr Robert had said he "ceased involvement" with GMT prior to the 2010 election. But new documents show that Mr Robert later transferred key aspects of another private company, Robert International, to the home address of his parents, Alan and Dorothy Robert, who were aged 74 and 71.

At this time, documents show Robert International held shares in GMT……

Robert International continued to hold shares in GMT until the end of 2011 - well after the 2010 election, and more than year after Mr Robert claimed he had "ceased involvement" with GMT.

Between 2007 and December, 2011, GMT picked up 356 government contracts worth more than $37 million. The average contract was worth just over $105,000.

More than 45 government agencies have used GMT, including the Department of Foreign Affairs and Trade, Department of Veteran's Affairs, and CrimTrac. Mr Robert was a member of Parliament's Foreign Affairs, Trade and Defence committee while many of those contracts were awarded. 

Mr Robert did not respond to a request to explain why he had listed his parents as directors and shareholders.

Robert International held shares in GMT until at least December 22, 2011. On that date, Mr Robert's business partner, Andrew Chantler, notified ASIC he was moving GMT's eight remaining shares in Robert International over to Chantler & Associates. The eight shares were valued at a combined $10,000. ​

ASIC documents show Robert International was re-registered to Mr Robert's home address in September last year, and the MP's most recent register of interests shows he is a director of the company - a position he resumed when his parents ceased to be directors in February 2016. Mr Robert paid $2 for the share previously owned by each of his parents.

Gold Coast Bulletin, 14 September 2017:

John Price, from the Australian Securities and Investments Commission, told a parliamentary economics committee hearing in Canberra on Thursday the watchdog would make inquiries, after Labor questions on whether he had seen the media report.

"Will ASIC be investigating that?" Labor MP Matt Keogh asked.

"I think we'll make some inquiries into that, yes," Mr Price said.

ASIC confirmed in the hearing no identity check was needed for someone to become a company director, but rather it was a matter of filling in a form.

Without directly commenting on Mr Robert's case, Mr Price said knowingly lodging a false or misleading document was an office under corporations law with a maximum term of five years in jail.

The Member for Braddon in 2016:

Friday, 22 April 2016

Do We Need A Royal Commission Into The Banks?

The Fairfax Ipsos poll of April 17 found 65% of the public supported a banking Royal Commission.  Yet the Government (minus initially a few backbenchers) vigorously opposes it, slamming it as “populist”, “reckless”, a “distraction”, and a waste of money.  Furthermore the Government claims it would take too long and be likely to erode public confidence in the finance system.
These Government spokesmen – Turnbull, Morrison, Cormann and others – obviously cannot see that the community is sick of the recurring finance sector scandals and has no confidence in any current measures for making these powerful institutions behave ethically – and indeed within the law.
Another oft-cited reason for the Government’s rejection of a royal commission is that we already have “a tough cop on the beat” in the form of the Australian Securities and Investments Commission (ASIC).  ASIC, they reiterate, has both the power to investigate and to prosecute.  They point out that while a Royal Commission can investigate, it has no power to prosecute.
While the “tough cop’s” powers may exist, it has not had any success in stemming the flow of finance sector scandals.  Indeed many of the revelations of bad behaviour have not been as a result of ASIC investigations but the work of whistleblowers and financial journalists. And it would seem that the fines resulting from ASIC investigations have seemed more like “slaps on the wrist” for bad behaviour rather than effective deterrents.
In addition the “tough cop”, along with other government entities, has had its response capacity limited by the very Government which claims ASIC has all that is needed to keep the banks and other finance institutions in line.  In the 2014 budget ASIC lost $120 million over 5 years.  This has obviously affected its investigative capacity.
The increasing clamour for a Royal Commission has worried the Government because of the proximity of the election. Consequently Treasurer Morrison announced recently a series of measures which he claims will solve the bank problem.  These measures include at least $120 million in extra funding, tougher penalties for wrong-doing, greater powers for ASIC and an extra commissioner to focus on prosecuting crimes in the finance sector.  These changes will be financed by the banks who will be hit with a levy of $121 million. The costs to the banks are not, according to the Government, to be passed on to bank customers.
Morrison and the Government are obviously hoping this response will undermine the appeal of Labor’s Royal Commission commitment. Presumably the Government backbenchers  who were supporting the need for a Royal Commission are now satisfied but it’s doubtful that many in the broader community – and particularly those who have been ripped off by the banks – will be.
Those who want the kind of extensive open inquiry that a Royal Commission can provide, have no confidence in ASIC as a body to expose and deal with financial industry malpractice.  This view was highlighted by a Senate committee in 2014 which found ASIC to be “a timid, hesitant regulator, too ready and willing to accept uncritically the word of the bank”.  There is considerable doubt about whether these latest measures will change that. 
Furthermore, is ASIC to investigate its own responses to the plethora of financial scandals? This is a matter which certainly needs to be investigated to ensure that such inadequate responses do not happen again.  Conflict of interest issues mean ASIC cannot be given this important task.  There is, of course, a question about whether the Government wants a light shone on ASIC’s performance just as there is a question about what appears to be its cosy relationship with the banking/finance industry.
This close relationship has been seen as a major reason for the reluctance of the Abbott/Turnbull Government to take effective action to protect consumers.  A prime example of this was its desire to wind back the Future of Financial Advice reforms legislated by the previous Labor Government.   These reforms had been introduced to protect customers from unscrupulous behaviour by advisers and their employers.  The Government failed to wind them back only because of Senate opposition.  Another more recent example of this close relationship is the funding the National Australia Bank is providing as a co-sponsor for a political fundraising breakfast for Kelly O’Dwyer, member for Higgins and the Assistant Treasurer.
The sense of entitlement that banks have about being able to operate with as little government interference as possible – even when behaving badly – was clearly obvious early this month after Labor announced that, if elected, it would hold a banking Royal Commission.  The head of the banking industry lobby, the Australian Bankers Association, refused to rule out the possibility of a mining-style tax ad campaign against Labor.  Presumably the widespread community support for a Royal Commission revealed in a recent poll might make this lobby group realize that such a campaign could backfire.
What is very obvious is that there is a need to shine a very strong light on the banking/ finance industry in order to force the changes that are required to make it fairer and more responsive to customer needs.  Moreover there is an ongoing need to ensure proper compensation for consumers who have been hurt by unscrupulous behaviour over recent years.  And the “bad apples” in the sector need to be identified and removed.  This would lead to a marked improvement in public confidence in the banking/finance system.  The Government measures are clearly too little, too late and were merely rolled out because of fear of an electoral backlash rather than because of any conviction that action was needed.
The Royal Commission into Institutional Responses to Child Sexual Abuse has shown how powerful is the shining of a strong, very public light on institutions which have done the wrong thing.  We need a Royal Commission into the banking/finance industry to force a sweeping clean-up in this sector.
Northern Rivers

GuestSpeak is a feature of North Coast Voices allowing Northern Rivers residents to make satirical or serious comment on issues that concern them. Posts of 250-300 words or less can be submitted to ncvguestspeak AT for consideration. Longer posts will be considered on topical subjects.

Sunday, 10 October 2010

How to keep the shareholders quiet, but not necessarily happy

CBD, a column in The Sydney Morning Herald's BusinessDay, reported on Friday:

Mirvac Group has come up with what appears to be a cunning plan to silence debate at its annual meeting.
The property group dispatched its invitation for the meeting yesterday, which will be held in Brisbane at 10am on November 11.
One wonders if the shareholders should be able to start discussing the third resolution, the remuneration report, about the one-hour mark, when the nation has a moment's silence for Remembrance Day.


The copper explorer Cudeco has found another way, whether intentional or not, to dampen debate at its annual meeting.
Cudeco announced yesterday that it planned to hold its meeting in the easily accessible Cloncurry Shire Hall on November 30.
The company headed by Wayne McCrae usually holds its annual meeting on the Gold Coast. Cudeco has been feeling the heat recently for its tardy release of a hugely disappointing resource update on its Rocklands tenement and decision to buy back a swag of shares before its share plunge.
Unlike the last time it held its annual meeting in Cloncurry, Cudeco is yet to provide a list of local car hire companies, and hotels in Cloncurry and Mount Isa. It previously listed its preferred hotels in Cloncurry as the Wagon Wheel Motel and The Coyote Inn.

However, CBD failed to mention the ever-so clever strategy employed by NRMA and its "step-sister" IAG to keep some of their folk quiet.

By some magic stroke of coincidence, NRMA and IAG managed to convene their annual meetings at exactly the same time. Yes, NRMA is calling its members together at 10.00am on Wednesday 27th October and IAG is having its annual get-together at precisely the same time. How convenient!

NRMA's event, which has a big program that's dominated by an item of special business that will see its current constitution thrown out and replaced lock-stock-n-barrel by a new one, is being held in down-town Wollongong while the ugly step-sister, IAG, is having its shindig in Sydney.

Those arrangements obviously suit the teams running the shows but overlook the shareholders and members of the organisations who want to attend both events and voice their views about what's going on.

What does ASIC have to say about this?