The former chief executive of collapsed stockbroker BBY charged with aiding and abetting
The former chief executive of failed stockbroking firm BBY has faced court charged with aiding and abetting.
The former chief executive of collapsed stockbroking firm BBY has faced court in Sydney on two aiding, abetting, counselling or procuring fraud charges.
Arunesh Narain Maharaj allegedly helped another BBY staff member to dishonestly obtain a financial advantage from St George Bank, the Australian Securities and Investments Commission (ASIC) said.
“The financial advantage was obtaining additional funding by way of improperly drawing down on an overdraft facilitation account, which BBY held with St George Bank which BBY was not entitled to,” the regulator said in a statement.
Mr Maharaj was charged with two offences that each attract up to 10 years’ jail time.
The first is related to allegedly obtaining additional funding in June 2013. According to a court attendance notice, supplied to The Australian by the Downing Centre Local Court, Mr Maharaj allegedly “did aid, abet, counsel or procure” an offence by Fiona Bilton.
Ms Bilton was the former head of operations at the failed firm, and in June this year was sentenced to jail for 20 months after she pleaded guilty to three charges of dishonestly obtaining a financial advantage.
She was also ordered to serve 380 hours of unpaid community work, after she “sent false summaries of unsettled client contracts to St George to support the requests for additional funding from its overdraft facility”, according to an ASIC statement from June.
She claimed additional funding on behalf of BBY from an overdraft facility for BBY 115 times.
According to the ASIC statement, the judge in Ms Bilton’s matter noted her conduct involved “serious offending and the obtaining of an extremely large financial advantage for BBY, and masked the risk of lending from St George”.
Ms Bilton was disqualified from managing corporations for five years and will be unable to be involved in the business of a market participant in connection with securities and futures markets.
In Mr Maharaj’s matter, the court attendance notice reported his second charge related to allegedly obtaining additional funding from November 2014 to early 2015.
As with the first charge, the second also involved Ms Bilton, according to the notice.
BBY was placed into administration in 2015 when it could not repay a loan to St George bank.
According to previous reports, when BBY failed 6000 customer accounts were caught up in the affair. Liquidators KPMG were tasked with delivering repayments to clients whose claims amounted to about $65m when the firm collapsed.
BBY was run by chairman Glenn Rosewall, whose father was tennis great Ken Rosewall, and lawyer David Perkins.
The sporting star was also a company director, who in 2022 lost a NSW Supreme Court case over the failed stockbroker and was ordered to pay liquidators $3.3m plus interest.
ASIC suspended BBY’s AFS licence in May 2015.
That suspension remained in place until its licence was cancelled in June 2021.
ASIC’s investigation into BBY is ongoing. The matter was adjourned to December 5.
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