Australian Capital Reserve trio charged

Three former directors of Australian Capital Reserve appeared in the Local Court in New South Wales on Tuesday on charges brought by the Australian Securities and Investments Commission. ASIC publicised the charges yesterday.

ASIC said the three charged were Murray Lapham, Steven Martin and Samuel Pogson. ASIC said it charged them under the NSW Crimes Act with one count each of making a false statement to obtain a financial advantage for ACR.

ASIC alleges that the directors concurred in the making of a statement in ACR's Prospectus number lodged in April 2004, which contained the financial statements of ACR's parent company, Castle Investment Company Limited (CIC) and controlled entities as at December 2003.

ASIC alleges that the stated pre-tax profit of $7.4 million included sales was revenue from transactions that had not properly occurred by the balance date.

ASIC said that it also charged Samuel Pogson with one count of making a false or misleading statement in a form lodged with ASIC.

Estate Property Group (the later name for CIC) and its subsidiaries, including Australian Capital Reserve, went into voluntary administration in May 2007.

ASIC said that by May 2007 ACR had lent $332 million of noteholders' funds to 13 of EPG's property-owning subsidiaries.

Administrators of ACR have so far returned 47 cents in the dollar to creditors.