At the May/June Senate Estimates, I queried ASIC about their investigation into allegations raised by several whistleblowers regarding a major bullion company charging for sales and storage of bullion it did not hold.
While ASIC did investigate, they allowed the company months to get their affairs in order and provided advanced notice of the audit date, enabling potential moving of bullion to defeat the audit, possibly resulting in multiple counting of the same bullion. Furthermore, there are allegations that bullion not belonging to the audited investment scheme but belonging to another entity, was included in the audit.
Despite several sessions with ASIC on this matter, none of their responses have addressed the fundamental issues surrounding their flawed investigation. The case has now been referred to another agency and I await the outcome.
Transcript
Senator ROBERTS: It’s now been found that the bullion inspected was the property of three companies operating two investment schemes. Were you aware that your auditor was inspecting bullion belonging to two companies not under investigation?
Ms Court: I’m unable to comment further on this issue of the bullion company. I haven’t got further information beyond that which—
Senator ROBERTS: So you’re not saying that you won’t answer; you’re saying that you haven’t got it with you.
Ms Court: I’m saying I—
Senator ROBERTS: We’ll put it on notice.
Ms Court: Perhaps—if you put questions in relation to this issue. I’m assuming that your questions relate to a continuing investigation that Mr Savundra referred to. In those circumstances, it would be appropriate to put those on notice to make sure that we can answer them comprehensively.
Senator ROBERTS: I’m talking about the audit. I’ll continue with questions on the audit. What steps did your auditor take to ascertain ownership of the bullion being offered as theirs? What steps did the auditor take?
Ms Court: I think it would be preferable to take those questions on notice. You’re asking for details of an investigation. We have given evidence previously that the matters raised in relation to the bullion company have been extensively investigated.
Senator ROBERTS: So it should be easy to get answers. Was the theoretical stocking figure provided for the amount of bullion just for one scheme as compared to gold for two? My information is that it was.
Ms Court: I will take that on notice.
Senator ROBERTS: The facility that held the bulk of the bullion did not have council approval for secure storage and, in fact, was not a secure storage. Why wasn’t the company prosecuted for charging customers for secure storage that didn’t exist?
Ms Court: I’ll take that on notice also.
Senator ROBERTS: Can you answer that now? It’s Senate estimates. The guideline is that you will answer if you can answer it now.
CHAIR: Senator Roberts, another ASIC inquiry is underway. In relation to operational matters, from time to time, ASIC provides information to senators in another forum where we can be very assured that appropriate structures are put around the information provided, so, when Ms Court says that she’s taking it on notice, that is appropriate in relation to this investigation.
Senator ROBERTS: This one? Okay. Will you now please set aside your pride, open up the investigation and work out what was done wrong and what action should be taken for misleading ASIC.
Ms Court: I’ve already said that I’d prefer not to answer further questions. Part of the challenge with answering the questions in the way that you’re putting them is that it assumes the correctness of the proposition in your question, which, of course, ASIC takes issue with. We reject that there has been any misconduct by ASIC in relation to this investigation. It has been conducted extensively over quite some time. As the chair has indicated, to the extent that you could wish us to address you on these issues in camera, then, of course, we would be willing to do that, if the committee seeks that briefing.
Senator ROBERTS: Okay. Can we do that? I’ll finish with the last question on this issue. I have put in more detailed questions on notice and ASIC has received the information I mentioned today directly, so I look forward to further communication on this matter and will take you up on the offer for the in camera briefing.
