Two directors of the Australian company Open4sale Global Ltd have been punished by a total of $ 2.8 million by the Federal Court for violating the laws.
The Federal Court found out that Open4sale, Simeon La Barrie’s chief executive and Australian director Ewald Hafer violated the law in an increase of $ 1.3 million from $ 83 from March 2019 and July 2023 without acknowledging investors.
Mr La Barrie, who In two occasions refer to shareholders as ‘stupid’ In the professional correspondence seen by the court, a fine of $ 2 million was imposed for his role in violations.
When asked about the preparation of the audited financial statements, Mr La Barrie said he refused to carry out the audits carried out by the BDO accounting company because he opposed the cost. He said, “In my beautiful language I told them where to go because I won’t pay them $ 50,000.” Later he said that he was not going to pay $ 50,000.00 “for a bunch of idiots”.
Mr Hafer was fined $ 800,000. The court refused to order sanctions against Open4sale.
Pitch’s decks have made unacceptable claims that Open4Sale would make $ 57 billion in revenue in five years, despite the fact that it has no reasonable basis for these forecasts. Economic reports received by the court showed that Open4Sale did not produce income between 2016 and 2022 and accumulated about $ 9 million in net loss.
Evidence before the Court also showed that Mr La Barrie transferred more than $ 1.4 million in investor money to accounts, using some of them to pay for personal expenses such as rents and school fees.
During the performance of her decision, Justice Charlesworth noted the seriousness of this behavior, saying: “The evidence reveals a disgusting behavior by Mr La Barrie, is accompanied and explained by his provocative attitude towards the law.”
Its price noted that Mr Hafer, who received $ 137,975 in supplies for the signing of new investors from 2019, was able to stop raising money from investors, while there was no accompanying revelation document, but failed to do so. “The conclusion comes from the fact that Mr Hafer has chosen to continue to violate the law on companies because he has personally benefited from attracting even more investment by receiving the supply and I find it, said its price.
Its price also rejected the submissions that the behavior had not yet caused harm, noting that the company’s records “are so poor that it is not possible to distinguish its real financial position”.
In addition to their financial sanctions, Mr La Barrie has been ruled out from companies management for 12 years and Mr Hafer for 8 years.
Mr La Barrie and Open4Sale have been held by the future non -compliance of capital for 12 years and Mr Hafer for 8 years.
Mr La Barrie, based in the United States, is the founder and chief executive of Open4sale. Approved the issuance of shares to investors and controls the bank account in which investors’ funds were received.
Mr Hafer is an Australian director of Open4sale, who met with investors for distributing a shares application forms.