In a public statement, ASIC announced that it has commenced proceedings in the Federal Court of Australia against current and former directors of Linchpin Capital Group Ltd and Endeavour Securities (Australia) Ltd for allegedly “breaching their duties as officers of a responsible entity of a registered managed investment scheme”.
ASIC stated that the defendants in the proceedings include Ian Williams, the current director of Endeavour and Linchpin; Paul Raftery, the current director of Endeavour and Linchpin; Paul Nielsen, a former director of Endeavour and Linchpin; and Peter Daly, the current director of Linchpin.
Messrs Williams, Nielsen and Raftery were directors of Endeavour when it operated the Investport Income Opportunity Fund.
ASIC alleges that, while not appointed as a director, Mr Daly also acted as an officer of Endeavour.
“All four defendants were directors of Linchpin at the time of the alleged conduct,” ASIC stated in the announcement.
In March last year, ASIC successfully obtained orders against Linchpin and Endeavour for multiple contraventions of the Corporations Act relating to the operation of the fund and a second managed investment scheme, operated by Linchpin, also called the Investport Income Opportunity Fund.
ASIC has alleged in the current proceedings that each of the defendants was personally involved in contravening conduct about which the court made orders in March 2019.
The corporate regulator further alleges that the defendants failed to act in the best interests of investors in the fund.
ASIC is also stating in its case that Mr Daly and Mr Raftery made improper use of their positions as officers of Endeavour to gain a financial advantage for themselves.
ASIC is seeking declarations of breaches of s601FD of the Corporations Act and the imposition of civil penalties as well as orders that Mr Williams, Mr Nielsen, Mr Daly and Mr Raftery be disqualified from acting as directors for a period of time.
