This article is from the Australian Property Journal archive
FORMER Melbourne property spruiker Henry Kaye has been disqualified by the corporate regulator from managing corporations for five years.
The move comes follows seven year investigation by ASIC into Kaye’s affairs after receivers and administrators were appointed to his company National Investment Institute and its subsidiaries in 2003.
This suspension also follows a failed attempt by ASIC to prosecute Kaye in the Melbourne County Court on criminal charges.
In March 2007, ASIC alleged that Kaye dishonestly obtained a financial advantage for another by deception in relation to a $17.705 million credit facility he obtained from St George Bank for a property development, Oasis apartments.
But in April 2008, the Commonwealth Director of Public Prosecutions pulled the plug on the trial.
The CDPP said in light of new evidence presented by a witness that was significantly different from the evidence given by the same witness at the committal proceedings.
ASIC yesterday said Kaye was disqualified following his involvement in 26 failed companies which provided investment and property education services to the public and the running of property investment and development activities.
The disqualification order permits, subject to conditions, Kaye to manage two companies, Dorcas 1 Pty Ltd and Medinvest 2 Pty Ltd, being the trustee companies to Kaye’s self-managed superannuation funds.
ASIC found that Kaye breached his duties as a director by failing to document significant intercompany loans within the group and to ensure that those loans were properly secured.
Further, such loans were made to companies that were controlled by Kaye and were not repaid, which contributed to the collapse of the group of companies.
ASIC also found that Kaye repeatedly failed to maintain adequate financial records in relation to a number of companies and was not fully aware of the financial position of the main companies within the group.
Kaye has the right to appeal to the Administrative Appeals Tribunal for a review of ASIC’s decision.
Australian Property Journal
