Former Octaviar top gun David Mark Anderson could face up to 12 years behind bars if he is convicted of fresh charges

Fresh detail has emerged about what may have led to high-flying former Octaviar chief financial officer David Mark Anderson being charged with $4.61m fraud with a liquidator’s report shedding light on the case.

UNRELENTING

Just over a decade since one of Australia’s worst GFC-spawned corporate disasters, the fallout remains unrelenting for some of the key players.

A case in point emerged yesterday when we learned that a former top gun at failed Gold Coast investment colossus Octaviar could face up to 12 years behind bars if he is convicted of fresh charges.

Ex-chief financial officer David Mark Anderson appeared in Southport Magistrates Court this week charged with 26 counts of fraud. He did not enter a plea and was released on bail, with the matter adjourned until September 2.

ASIC alleges that Anderson misappropriated $4.61 million as head of Octaviar subsidiary Octaviar Investment Holdings No 3 Pty Ltd between June 2012 and September 2015.

The ex-director of an Octaviar subsidiary has been charged with fraud.

The regulator claims he “dishonestly applied’’ the money for his own use and was sole director of the entity at the time.

The Octaviar group, previously known as MFS, crashed in 2008 owing $2.5 billion and the Anderson case marks the first time criminal charges have been levelled against any of the company executives.

The setback for Anderson comes three years after a court ruled in a civil case that he was one of five Octaviar executives who had breached their directors’ duties after they improperly diverted $147.5 million of members’ money to repay company debts.

These executives were then banned from running companies for various periods in mid-2017 and collectively ordered to pay a staggering $615 million in compensation over the misuse of investor assets.

Anderson was prohibited from managing companies for 25 years, fined $500,000 and ordered to pay $205.7 million in compensation and 70 per cent of ASIC’s court costs.

He discontinued his appeal in late 2017 but the others, including former CEO Michael King, are still locked in a legal battle with ASIC that’s set to be decided in the High Court.

Former MFS chief executive Michael King.

An ASIC spin doctor would not reveal if any of the money Anderson owes has been paid but there’s widespread speculation that none of it will ever be coughed up.

Anderson, a portly 59-year-old, could not be reached for comment yesterday.

Property records show he offloaded a waterfront 6-bedroom home at Mermaid for just over $1 million in early 2017.

MONEY MOVEMENT

ASIC wouldn’t reveal much yesterday but City Beat has learned quite a bit more about the Anderson case thanks to a liquidator’s report issued after the corporate watchdog won court orders to wind up the Octaviar subsidiary in June 2017.

The company, which fell over with debts of $3.2 million, had been set up as a “special purpose vehicle’’ for an aged care investment.

The asset was sold prior to Octaviar’s demise and the report says it’s not clear how the proceeds were distributed.

But liquidators Andrew Fielding and Helen Newman from accounting mob BDO give us a few clues as to what might have happened.

“ASIC’s investigations prior to our appointment identified funds held in Anderson’s personal bank account which originated from a company bank account. These funds have been frozen by ASIC,’’ their report says.

“We are aware from ASIC’s investigations that funds from (the Octaviar subsidiary) bank accounts totalling approximately $2.2 million were utilized to meet Anderson’s own legal costs.

“Anderson has not disputed that some of the frozen funds originated from the company’s bank account but considers the transfer of funds to his personal account, and the use of funds to meet his legal costs, to be permissible.’’

Following the appointment of liquidators, Anderson lobbed a settlement offer regarding the frozen funds which would have seen $800,000 retained in his lawyer’s trust account for future legal costs and most of the balance go back to the company.

Not surprisingly, the deal was knocked back.