ASIC has commenced civil penalty proceedings in the Federal Court against Paul Ryan, director of Dixon Advisory & Superannuation Services Pty Limited, for alleged breaches of directors’ duties.
ASIC alleges Mr Ryan breached his duties as a director by his involvement in decisions ASIC alleges were to the advantage of Dixon Advisory’s holding company, E&P Operations Pty Ltd, and by failing to properly consider the interests of Dixon Advisory’s creditors. Mr Ryan was also a director of E&P Operations.
ASIC Deputy Chair Sarah Court said: ‘Directors have responsibilities under the law to act in the best interests of their company, and this includes considering the interests of creditors when the company is facing insolvency.
‘The creditors included thousands of financial advice clients who had invested in the US Masters Residential Property Fund and financial products operated by entities related to Dixon Advisory. These creditors suffered significant losses.’
ASIC alleges that Mr Ryan was involved in:
amending the constitution of Dixon Advisory on 22 December 2021 to expressly authorise its directors to act in the interest of E&P Operations; and
executing a deed of acknowledgement of debt (Deed) on 24 December 2021 between Dixon Advisory and E&P Operations to the advantage of E&P Operations and to the detriment of Dixon Advisory.
ASIC further alleges that at the time the Deed was entered:
E&P Operations owed Dixon Advisory over $19 million;
Dixon Advisory was approaching insolvency and therefore its directors were obligated to consider the interests of creditors;
the Deed imposed conditions which adversely affected Dixon Advisory’s right to recover this $19 million debt.
‘These proceedings underline our commitment to ensure directors meet their governance obligations, including where they serve on the boards of multiple companies in a corporate group,’ concluded Ms Court.
