Queensland director disqualified from managing corporations

https://asic.gov.au/about-asic/news-centre/find-a-media-release/2021-releases/21-166mr-queensland-director-disqualified-from-managing-corporations/

Jacob (Jake) Robert Henley, of Queensland, has been disqualified from managing companies for three years after his involvement in nine failed companies.

Mr Henley was a director of nine companies that went into liquidation between February and May 2017, namely:

• Gym and Tonic Healthclubs Pty Ltd (ACN 135 011 853) (Gym and Tonic);
• Yelneh Industries Pty Ltd (ACN 164 784 623) (Yelneh);
• TVH Enterprise (Australia) Pty Ltd (ACN 158 538 080);
• Performa Nutrition Pty Ltd (ACN 163 533 480);
• Fitness Managament Company Pty Ltd (ACN 164 326 185)
• Snap Fitness Double Bay Pty Ltd (ACN 603 346 541);
• Seedz Investments Pty Ltd (ACN 163 750 481);
• Henleys Property and Construction Group Pty Ltd (ACN 608 273 178); and
• The Henley Group Pty Ltd (ACN 600 266 644).

The companies operated in the health and fitness, hospitality, arts and recreation, business and personal services and construction industries.

In making its decision to disqualify Mr Henley, ASIC found that in relation to Gym & Tonic and Yelneh (the companies), he:

• failed to exercise his powers and discharge his duties as a director with care and diligence, good faith and in the best interest of the companies;
• failed to take reasonable steps to ensure that the companies complied with their obligations to keep accurate written financial records;
• failed to assist the liquidators by not delivering the companies’ books and records;
• failed to act with care and diligence by allowing the companies to trade while insolvent or likely to be insolvent;
• improperly used his position as director by transferring or withdrawing a combined total of $154,690 from the companies to gain an advantage for himself or related parties; and
• conducted himself in a manner that was below the standard expected of a company director.

The nine companies collectively owed approximately $13,791,221 to creditors, of which $10,471,239 was owed to unsecured creditors, and $314,514 of this was owed to the Australian Taxation Office.

In making its decision, ASIC relied on supplementary reports lodged by the liquidators of Gym and Tonic, Shumit Banerjee and Ian Purchas of SV Partners, and the liquidator of Yelneh, Gavin Moss of Chifley Advisory. ASIC assisted both liquidators to prepare supplementary reports by providing funding from the Assetless Administration Fund.

Mr Henley is disqualified from managing corporations until 1 July 2024.

Background

Section 206F of the Corporations Act gives ASIC the power to disqualify a person from managing corporations for up to five years if, within a seven-year period, the person was an officer of two or more companies that were wound up and the liquidators lodge reports with ASIC about each company’s inability to pay its debts or alleging misconduct.

ASIC maintains a banned and disqualified persons register that provides information about people who have been disqualified from:

• involvement in the management of a corporation;
• auditing self-managed superannuation funds (SMSFs); or
• practicing in the financial services or credit industry.

Editor's note:

On 24 August 2021, Mr Henley filed an application for a review of ASIC’s disqualification decision with the Administrative Appeals Tribunal. A hearing date is yet to be set.

Editor's note 2:

On 28 July 2022, Mr Henley withdrew his application to the AAT, and remains disqualified until 1 July 2024.