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Monday, September 5, 2016

Salim Mehajer banned from managing corporations for three years



by


Journalist
Sydney



The flamboyant former deputy mayor of Sydney’s Auburn, Salim Mehajer has been banned from managing corporations for three years to protect the public from his “incompetence” after the corporate regulator found his business conduct “lacked commercial reality”.
In an unusual situation, the Australian Securities and Investments Commission this morning announced it had banned Mr Mehajer in November last year — three months after his opulent wedding drew attention to allegations of corruption at Auburn Council — but he had appealed the decision and also successfully obtained court orders suppressing disclosure of the banning order.
On August 19 the Administrative Appeals Tribunal upheld ASIC’s decision to disqualify Mr Mehajer and found the property developer had “adopted a cavalier approach” to managing two of his failed companies.
Those companies were SM Property Developments and SM Engineering and Constructions, which owed over $1 million to the Australian Taxation Office as well as money to other creditors.
ASIC’s banning orders in November last year came after an investigation by The Australian uncovered alleged serious irregularities with the way those companies had been operated.
The AAT decision upholding ASIC’s order was itself subject to a suppression order which expired midnight last Friday night.
It was immediately unclear why courts would grant suppression orders over such information to the detriment of transparent processes.
On Saturday, hours after the suppression order expired, Mr Mehajer posted to Instagram a picture of a ship on Sydney Harbour with the words “Goodbye Australia”.
“Will be taking off to pursue my dream challenges,” he wrote, along with the words “I’ll be back”.
The apparent departure comes a week after the public inquiry into Auburn Council wound up hearings.
The entire Auburn Council was sacked in February ahead of the inquiry, which was brought about following concerns over the close links between property developers and Auburn councillors.
ASIC found Mr Mehajers “inability to manage corporations to the standard expected of him” caused the two property development companies to collapse.
He had failed to ensure SM Project Developments “maintained adequate financial records” and to ensure it lodged legally required returns with the ATO, and only provided required information to the company’s liquidator “after ASIC took criminal proceedings against him”.
“ASIC also found Mr Mehajer’s conduct lacked commercial morality in that he allowed SMPD to collect GST of $315,192 from the sale of townhouses but failed to remit it to the ATO,” ASIC said in a statement this morning.
In July The Australian revealed Mr Mehajer was alleged to have moved $20m to Lebanon and NSW Police were understood to have prepared a report on the transfer.
The transfer was not illegal but is understood to have drawn the attention of authorities because of the controversy surrounding Mr Mehajer.