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ASIC bans directors for multiple company failures, $11.5m in debts

Regulation

Two unrelated directors have been disqualified for failing to meet their duties, including concerns that they traded while insolvent.

By Philip King 10 minute read

ASIC has disqualified two unrelated directors for multiple company failures that left almost $11.5 million in debts including more than $9 million to the ATO.

Athina Bragiannis of Preston, Victoria, has been banned for three and a half years for involvement in the failure of two property development companies, Cleveland Lodge Developments and Bellbird Estate Holdings, and one holding entity, Rococo Hawthorn No 1.

The three entered liquidation between October 2017 and February 2018 owing a combined total of $8,684,516.52 to unsecured creditors, including $7,902,469.35 to the ATO. Ms Bragiannis was a director since early 2012.

ASIC found that Ms Bragiannis acted improperly and failed in her obligations as a director:

  • She executed finance agreements on behalf of Cleveland Lodge Developments which were used to further the interests of another corporation of which she was also the sole director and shareholder.

  • She made payments from the bank account of Cleveland Lodge Developments to two corporations of which she was also the sole director and shareholder for goods and services that were not supplied.

  • She failed to ensure that Cleveland Lodge Developments paid GST on the sale of the property.

  • She failed to ensure that Cleveland Lodge Developments and Rococo Hawthorn No 1 kept written financial records.

  • She failed to prevent Cleveland Lodge Developments from incurring debts when there were reasonable grounds for suspect it was insolvent.

  • She failed to ensure Rococo Hawthorn No 1 and Cleveland Lodge Developments complied with their statutory lodgment obligations to the ATO.

  • She relied upon others to run the business and financial affairs of Cleveland Lodge Developments without adequate oversight.

In disqualifying Ms Bragiannis, ASIC relied on supplementary reports lodged by Cleveland Lodge Development’s former liquidator Richard Rohrt of Kennedy Ryan Advisory and its current liquidator, Andrew MacNeill of SMB Advisory, and Rococo Hawthorn No 1’s liquidator, Mr Rohrt. 

Ms Bragiannis is disqualified from managing corporations until 11 February 2027. 

ASIC has also disqualified Stefano De Blasi of Stafford Heights, Queensland, from managing corporations for four years over his involvement in three failed companies that wound up owing $2.8 million. 

Between 2014 and 2020, Mr De Blasi was a director of Casa Gusto, SMC Drummoyne and Popina Kitchen, which were all operating in the retail food industry in Sydney.

In relation to SMC and Popina, ASIC was concerned that Mr De Blasi had traded the companies while insolvent and failed to meet statutory ATO lodgement requirements and keep proper business records.

The companies’ debts included $1.3 million to the ATO and $162,000 for workers’ compensation insurance and payroll tax.

ASIC relied upon an initial statutory report lodged by liquidator Steven Kugel of the Insolvency Experts, who was appointed to Casa, and supplementary reports lodged by liquidators Andrew Sallway of BDO Australia, who was appointed to SMC and Adam Preiner of Integra Restructuring and Insolvency, who was appointed to Popina.

Mr De Blasi is disqualified from managing corporations until 21 August 2027.

His co-director of the three companies, Edoardo Perlo, was previously disqualified for four years.

 

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Philip King

Philip King

AUTHOR

Philip King is editor of Accountants Daily and SMSF Adviser, the leading sources of news, insight, and educational content for professionals in the accounting and SMSF sectors.

Philip joined the titles in March 2022 and brings extensive experience from a variety of roles at The Australian national broadsheet daily, most recently as motoring editor. His background also takes in spells on diverse consumer and trade magazines.

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