Reasons behind Lance Rosenberg’s Ban Overturn
The Administrative Appeals Tribunal or known to as the AAT overturned the banning order which was actually imposed by ASIC towards Mr. Lance Rosenberg who is the Director of Tricom Equities Limited from providing financial services for 4 years. Though the process of its decision is still there for the review, there are actually some interesting comments which have been made.
The conduct giving actually caused towards the banning order that’s related with the actions of Mr. Rosenberg with regards to the securities which Tricom and was held by it as a security for loans had an on-lent to Opes Prime. Opes Prime also had administrators that were appointed back in March 27, 2008. With an on-lent securities to Opes Prime and to be concerned on the ability of Tricom in recovering the securities, Rosenberg spent days after March 27, 2008 in order to get advice from the corporate advisers and from insolvency specialists with regards to the best way on how to recover it.
Prior to putting in place the special crossing, Rosenberg still continue communication with the ASX about the position. When he was actually in that special crossing, Rosenberg implemented a negotiation with the lenders and settled the crossing before it was actually due for them in financing the acquisition on securities as well as to cancel the special crossing.
Another thing is that the AAT considered various expert evidence and that the ASX Listing Rules to the case with where they relate with the off market transactions such as special crossing and information that was made for investors about the transaction.
The AAT also sees such special crossing as off market transactions to where transactions which is specific on ASX had been transacted off market through a special crossing price and comes with no relation on its market prices for security.
This would be where the AAT later on arrived to the conclusion that the evidence are going to be provided by the ASIC did not make it out that the relevant sections of the Corporations ACT were contravened. As an addition on the question of evidence about the certain contraventions, the context in making the banning order was later on considered.
The AAT then considered that the banning order should be discretionary and should never be required of being imposed by the ASIC. The main purpose of the banning order is to protect the public as well as to act as a deterrent to the concerned person as well as other participants in the market.
The case have to provide comfort to directors that while an ASIC delegate consider the action that’s taken under time pressure in a difficult time is actually in breach with the law. The AAT also considers much broader set of circumstances in various options to a director that also includes those available for Mr. Rosenberg to seek recovery from the securities and off market transactions was also unlikely to prejudice the investing public.