Magnis Energy Technologies whistleblower takes aim at ASIC over past probe

ASIC’s first investigation into Magnis chair Frank Poullas failed to grasp alleged insider trading and disclosure breaches, a whistleblower has told a parliamentary hearing.

Magnis chair Frank Poullas. Picture: Britta Campion

A parliamentary committee has heard the corporate regulator has opened a new investigation into ASX-listed battery play Magnis Energy Technologies, as a whistleblower revealed a previous probe was mishandled and failed to act on warnings of alleged insider trading and share price manipulation.

Appearing before the Senate Economics committee on Wednesday, Magnis’ former investor relations director Travis Peluso said he had attempted to raise multiple serious issues concerning Magnis with the Australian Securities and Investments Commission.

However, Mr Peluso said ASIC’s investigators were slow to respond and ultimately dropped the investigation into Magnis’ chair Frank Poullas.

As revealed in The Australian, Mr Poullas was subject to a raid on his Marrickville home by the Australian Federal Police after ASIC opened an investigation.

Mr Peluso told an inquiry into the Australian Securities and Investments Commission investigation and enforcement while working at Magnis it was apparent directors were sharing “a considerable amount of information that the public wasn’t aware of in regards to deals” with shareholders.

“I approached the chairman (Mr Poullas) many times and many others did to try get him to stop and he would just deny it,” he said.

“There was nothing we could do to stop him.”

Magnis Chair Frank Poullas. Picture: Supplied

As revealed in The Australian, Mr Poullas told the AL Capital director Wayne Mo in 2019 to buy in “at considerably lower ­prices” to a proposed share placement.

Mr Peluso said Magnis shareholders were using this inside information to trade on the company “and then would get upset when those announcements weren’t made in the time frames that was specified to them”.

Mr Peluso said after a very short time working with Magnis “it became apparent that there was a number of concerns in regards to corporate governance in regard to insider trading in regards to misrepresentation of announcements that were going to the ASX”.

He said further to that, there were also issues at Magnis over directors and executives being removed from the organisation when they raised questions over “the integrity or the corporate governance or any of the announcements that were being put out”.

Mr Peluso told the committee that Mr Poullas, who has chaired Magnis for 13 years, would work with shareholders to remove challengers when they attempted to raise concerns over governance.

The Australian is not suggesting Mr Poullas enabled insider trading or disclosure breaches, only that a parliamentary inquiry has heard these allegations.

The committee heard Mr Peluso made detailed whistleblower complaints to ASIC concerning information around insider trading, share price manipulation and poor corporate governance but this wasn’t acted on for almost 18 months.

He said despite this ASIC dropped its investigation into Mr Poullas

“It amazes me that it took as long as it did,” he said.

“It amazes me that I had one meeting with two investigators, and I never heard from them again.”

But in a late supplementary response to the inquiry ASIC revealed it has reopened an investigation into Magnis in recent weeks examining “suspected false or misleading statements and breaches of continuous disclosure obligations by Magnis”.

ASIC said its new probe kicked off in July 2023 after closing its earlier investigation after a number of reports were made about “suspected misconduct concerning Magnis”.

ASIC said it had found a breach of the requirement to notify the market of relevant interest in the company “was potentially arguable” but the regulator could not identify harm.

But Mr Peluso said ASIC’s response “astounds me” given it failed to investigate elements of his and others‘ complaints.

Magnis has been contacted for comment.

Originally published as Magnis Energy Technologies whistleblower takes aim at ASIC over past probe