ASIC prosecutes Austal (ASX:ASB) and former CEO

Company News

by Melissa Darmawan

Financial whistleblower ASIC has launched civil penalty proceedings against Austal (ASX:ASB) and its former chief executive David Singleton in the Federal Court of Australia on the company’s market disclosures with respect to Austal’s Littoral Combat Ship program before July 2016.

The proceedings allege that Austal was aware as early as June 4, 2016 of the need to make a material write back of work in progress attributable to the Littoral Combat Ship program. Austal made its announcement notifying of the write back on July 4, 2016.

ASIC is seeking civil declarations that Austal contravened its continuous disclosure obligations as well as the relevant misleading and deceptive conduct provisions of the Corporations Act 2001 and the Australian Securities and Investments Commission Act 2001.

The proceedings in relation to Mr Singleton allege that he was involved in the company’s contravention of its continuous disclosure obligations and failed to discharge his duty to exercise due care and diligence in relation to matters concerning the disclosure of the earnings write back.

Austal said it would consider the documentation provided by ASIC before deciding its next steps.

Shares in Austal (ASX:ASB) last traded 0.22 per cent lower at $2.315.