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Between them the two were involved in seven failed companies and the one involved in phoenix activity gets maximum ban.
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Regulator bans two directors for over $10m debt, multiple failures
01 February 2023
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9 minute read
ASIC has disqualified two unrelated directors with a combined total of seven failed companies and more than $10 million in debt to unsecured creditors, including more than $8 million to the ATO.
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Victorian director Mr Kevin Prakash Verapen of Montmorency has been banned from managing corporations for three years after ASIC found he failed to act with appropriate care and diligence as director of three companies from August 2015 to April 2017.
The companies:
– Hygrade Management & Software, involved in laser cutting.
– A&S Services Australia, which operated a pre-insolvency and advisory business.
– E&A Logistics, a truck rental business.
ASIC found Mr Verapen failed to act in the best interests of the companies and:
- Received $24,500 in cash to become a director of 18 companies between August 2014 and January 2016, including the three failed operations, while other people performed the role of directors and managed the companies.
- Had limited involvement and oversight of companies or otherwise perform any functions of a director.
- Received cash to sign unread documents and assist in opening bank accounts.
- Failed to keep written company financial records.
- Failed to lodge BAS, income tax returns and make PAYG payments, or make payments to staff superannuation funds.
- Failed to prevent HMS from incurring more than $1 million in debt when the company was most likely insolvent.
The three companies owed a combined total of $8,625,879 to unsecured creditors, including $7,678,177 to the ATO.
Mr Verapen is disqualified from managing corporations until 18 January 2026.
ASIC also disqualified Queensland-based director Aaron Luke Vasicek for the maximum period of five years for phoenix activity and the failure of four companies from 2010 to 2018.
Tyre and retail companies Tazzy Tyres Wholesale, Tazzy Tyres Accessories, Tazzy Tyres Retail and Tazzy Tyres wound up owing unsecured creditors $1,944,418, including $855,121 to the ATO.
ASIC found that Mr Vasicek engaged in phoenix activity when he transferred the assets of Tazzy Tyres Accessories and Tazzy Tyres to other companies for no consideration and failed to maintain proper financial records for all four companies.
Mr Vasicek is disqualified from managing corporations until 19 January 2028.
Both Mr Vasicek and Mr Verapen have the right to seek a review of ASIC’s decision by the Administrative Appeals Tribunal.
ASIC maintains a banned and disqualified persons register available on its website and is a member of the Phoenix Taskforce, which comprises federal, state and territory government agencies.
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