Liquidator suspended for “serious failure” to comply with industry obligations

Liquidator Alan Topp will be suspended by ASIC for six months following a decision by the Companies Auditors and Liquidators Disciplinary Board.

The corporate watchdog alleged Topp failed to lodge more than 300 documents with ASIC over a period of almost four years. The documents in question related to 61 different companies.

ASIC commissioner John Price said in a statement the decision will send a strong message to liquidators.

“The CALDB’s decision reinforces the fact that registered liquidators must competently meet both their statutory duties and professional standards,” he said. “This includes ensuring they have adequate practice systems and resources in place to manage their basic reporting obligations.”

The suspension commences on May 1 and will expire on October 31 this year. The CALDB also required undertakings from Topp to lodge with ASIC all outstanding statutory lodgements and organise replacement liquidators on all his current administrations by May 1, 2014.

At the time of the conduct in question, Topp was the sole director of Insolvency Resolution. In a statement, CALDB said Topp had not carried out his duties as a liquidator under the Corporations Act.

“The Board found that there had been a serious and systemic failure to comply with statutory obligations to lodge documents and a serious failure by Mr Topp to attend to his duties in a timely and reasonably diligent way,” the statement read.

David Lombe, president of the Australian Restructuring Insolvency & Turnaround Association, told SmartCompany liquidators must abide by their obligations.

“It goes without saying that liquidators must comply with their statutory duties,” he said. “It’s absolutely critical and it’s critical to keep creditors and the general public informed.”

In particular, Lombe said interested parties such as creditors should be informed because they can also access information through ASIC. When asked if he thought ASIC’s decision would send a clear message to the industry, Lombe said he thought it would.

“These things tend to be isolated cases and it’s a good process that ASIC looks at these matters and takes action,” he said. “I think it’s very important.”

Topp declined to comment and instead referred SmartCompany to his comments in today’s Australian Financial Review.

“All jobs were done on time and all important documents were filed,” he told the paper.