Tax boss V Liquidator – where’s ASIC?

Tax man targeting liquidator David Iannuzzi.

In an almighty tussle with the tax commissioner: Veritas Advisory’s David Iannuzzi.

The Tax Commissioner’s bid for a Federal Court inquiry into the conduct of liquidator David Iannuzzi is an eyebrow raiser for several reasons.

Documents made public by the Federal Court reveal that the tax boss wants an inquiry; an order requiring the Veritas Advisory principal to pay compensation; and an order banning him from holding a liquidator’s registration for 10 years.

As reported in SiN earlier this week Iannuzzi intends to vigorously defend himself against the CoT’s yet to be tested claims. He declined to risk compromising his defence by divulging details and SiN makes no suggestion of wrongdoing.

But when if ever has the Commissioner of Taxation (CoT) sought to ban a registered liquidator for 10 years? Isn’t that ASIC’s gig? And why is the tax commando not utilising its in-house legal firepower to try and take their quarry down?

At yesterday’s brief case management hearing two barristers including David McClure SC were on hand to prosecute the CoT’s interests.

Behind them in the public gallery loitered Minter Ellison’s Michael Hughes, in close proximity to one of the tax office’s key anti-phoenix operatives.

A barrow load of documents have already been filed by the plaintiffs which means a great many hours of Minter’s moments have been meticulously booked. This pursuit will be costly and the outcome uncertain.

Yesterday Justice Jacquie Gleeson made various orders including that Iannuzzi file and serve points of defence by 30 November 2017 and that the parties to be ready for hearing on the inquiry application on April 23, 2018.

Also yesterday, ASIC advised that it had extracted voluntary undertakings (VUs) from three liquidators who’ve fallen short of adequately complying with the liquidator cop’s Published Notices Website and Lodgement project. Never mind the phoenix activity, i’s are going undotted.

The three were Darwin’s Trevor Angus of Angus AccountantsDennis Offermans, of the insolvency firm, Offermans Partners and Giovanni Carrello, of BRI Ferrier WA. Of them  the VU of real significance attached to Angus, who has voluntarily undertaken to rub himself out by writing to ASIC requesting that his registration be cancelled.

By SiN’s calculations this will leave the Northern Territory with just two registered liquidators – Rodgers Reidy’s Stuart Reid and Allan Garraway. Good to see ASIC policing the fringes. But where is the liquidator’s regulator on major cases?

The CoT’s case against Iannuzzi includes allegations of phoenix activity involving certain shareholders of Banq Accountants & Advisers, none of whom at this stage appear to be subject to any proceedings.

ASIC and the ATO are members of the multi agency anti-phoenix taskforce. Part of the taskforce’s brief is information sharing. A great deal of information has been filed in the CoT’s case already.

But how much has been shared with ASIC, the body with statutory responsibility for regulating liquidators? And if the sharing has been voluminous, why isn’t ASIC, which is now to receive an extra $10 million a year in industry funding, taking the lead? The regulator, which like ARITA has been served in the Iannuzzi proceedings, declined to respond on the basis that the matter was before the courts.

Further reading:

Liquidator Facing 10 Year Ban

Phoenix Buster Representing DCoT As Iannuzzi Ousted

About the Author

Peter Gosnell
Peter Gosnell
Insolvency News Online illuminates the practice of insolvency Australia-wide, highlighting the triumphs and travails of the nation’s registered practitioners and the accounting and legal professionals who work with them. INO is produced by Peter Gosnell, former business editor and senior business reporter at The Daily Telegraph newspaper. During a decade-long career, your correspondent reported on such notable corporate collapses as HIH, One.Tel, Westpoint and Fincorp as well as some of the nation's highest profile bankruptcies and the investigations and prosecutions arising from Australia's most notorious instances of white-collar crime.

2 Comments on "Tax boss V Liquidator – where’s ASIC?"

  1. Who, What, Where, When (aka ASIC) | 20 October 2017 at 5:42 pm | Reply

    ASIC are as useful as a screen door on a submarine. I have a liquidator that is clear breach of s421 of the corporations act and refusing to hand over company docs. ASIC’s response after 11 months was “Thanks but we cant be stuffed” and ARITA doesn’t want to know, talk about a cosy club and protecting ones own nest. Incredibly as i am unable to submit tax returns the ATO has said “NOT ON” and going to take matters into hand, ASIC are a joke

  2. For your interest, I suggested years ago that the ATO had the potential to be the real insolvency regulator rather than ASIC, given the ATO’s strong powers: see “The ATO as an insolvency regulator?” [2007] A Insol J 24.
    And ATO’s powers are now likely to be further increased (see Treasury’s illegal phoenix company consultation paper).

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