ASIC LAUNCHES INVESTIGATION INTO SLATER AND GORDON FINANCIAL RECORDS
22 December 2016, Written by Brisbane Legal
SLATER and Gordon has been hit with two notices to produce documents, as the Australian Securities and Investment Commission (ASIC) investigates the accuracy of the embattled firm's records.
ASIC is seeking to determine whether Slater and Gordon deliberately falsified or manipulated documents over the course of almost 10 months in 2014/15.
The watchdog is particularly out to discover whether Slater and Gordon or any of its officers have committed offences.
Slater and Gordon has indicated it will cooperate with ASIC during its current investigation, providing the relevant notices later this month and in early January 2017.
ASIC states the notices should not be taken as an indication of legal contravention, nor should they be considered a reflection on any person or entity.
Under ASIC's magnifying glass is the period prior to when the firm posted a record $1 billion loss in FY16.
The financial catastrophy was largely caused by write-downs in association with its ill-fated acquisition of UK-based Quindell for $1.3 billion in 2015.
Following its most tumultuous year, a class action now looms for Slater and Gordon as rival firm Maurice Blackburn embroils the firm in one of Australia's largest ever corporate class actions to date, acting on behalf of around 3,000 shareholders.
The claim will allege that shareholders were ill-informed on the acquisition of Quindell and the impact of UK legislation changes, stating that Slater and Gordon failed to disclose vital information in a timely manner.
In November, more than 43 per cent of shareholders voted against Slater and Gordon's remuneration report, a move which earned the firm its 'first strike'.
If more than 25 per cent of shareholders vote against the remuneration report at next year's AGM, Slater and Gordon will be hit with its 'second strike' and a board spill will occur.
In the meantime, the company has established a performance improvement program to combat its failures in the UK market.
Author: Brisbane Legal Connect via: Twitter