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Thursday 23 November 2006 LAWFUEL – Law News Network – Mr Mark Timleris, of South Melbourne, has been sentenced today in the County Court of Victoria to three years imprisonment, with a minimum of 12 months, after pleading guilty to four criminal charges brought by the Australian Securities and Investments Commission (ASIC). Mr Timleris, formerly an alternate-director of Bustan Australia Holdings Pty Ltd and Bustan International Pty Ltd (the Bustan Group), was responsible for the agribusiness operations of the Bustan Group involving commodity trading in legumes, grain and wool.
The charges related to falsifying Bustan Group inventory and accounting records, dishonestly using his position to gain a financial advantage for the Bustan Group, and knowingly signing the false Bustan Group 2000 and 2001 financial statements subsequent to deceiving the former auditors, Ernst & Young. ASIC’s investigations found that Mr Timleris falsified the records relating to grain and legume stocks. This had the effect of materially overstating the market value of these assets to its lenders HSBC Bank Australia Limited and Rabo Australia Limited and enabled the continuation of a syndicated banking facility.
In sentencing Mr Timleris, Judge Felicity Hampel said ‘Dishonest commercial activity of this type cannot be countenanced. Conduct such as this must be punished so as to deter others from corrupting subordinates’. ASIC’s Executive Director of Enforcement, Ms Jan Redfern said the jailing of Mr Timleris showed that company directors who engage in misleading and deceptive behaviour will be brought to account. Ms Redfern also noted that the remorse shown by Mr Timleris, his early plea of guilty and his co-operation with the authorities was taken into consideration by the Court in sentencing today.
ASIC’s investigation is continuing. The Commonwealth Director of Public Prosecutions prosecuted this matter. Background On 2 November 2001, accounting firm Sims Partners was appointed as receiver and manager of the Bustan Group by secured creditors represented by Permanent Trustee Company Ltd. At the time the receiver and manager was appointed, there were seven common directors appointed to Bustan Australia and Bustan International respectively.
Two of the seven
directors were Australian citizens and the remainder were residents of the United Arab Emirates (UAE) and the United Kingdom. ASIC’s investigation commenced after it was alleged that the Australian company officers misled the UAE-based officers and shareholders, the auditors and the creditors over the financial performance of the company. At the time the financial reports for 1 September 2000 and 15 August 2001 were released, an unqualified audit opinion was issued. The 2001 audit opinion was later withdrawn when the financial position was proved to be materially false by at least $5.966 million. For further information contact: Jan Redfern Director Enforcement Telephone: 02 9911 2191 Mobile: 0411 119 210 Danielle Huck ASIC Media Unit Telephone: 03 9280 3407 Mobile: 0417 540 769