ASIC has permanently banned Kim Hanson over the alleged misuse of $3 million of trust funds and confirmed it is continuing to investigate Australian Reliance Group.
The corporate regulator has announced a permanent ban on Kim Hanson and confirmed it is continuing to investigate his former insurance company, Australian Reliance.
Today’s announcement comes four months after Business News reported that five court cases are underway as investors and lenders seek to retrieve funds allegedly lost in the break-up of Reliance Group in 2016.
In their sights are former AFL footballer Andrew Donnelly, who led the group, and Mr Hanson.
The Australian Securities and Investments Commission said Mr Hanson will be banned from providing financial services or controlling an entity that carries on a financial services business.
It added that a permanent ban was necessary due to concerns that Mr Hanson was not a fit and proper person to provide financial services.
ASIC said he would be likely to contravene financial services law if he continued doing so.
Mr Hanson was a director of Reliance Franchise Partners between June 2011 and August 2015.
He was also a director and company secretary of Australian Reliance from January 2003 to January 2016.
In addition, he was the chief financial officer of both entities from 2012 to January 2016.
Australian Reliance and RFP each held an Australian financial services (AFS) licence, with Mr Hanson being the responsible person for each licence.
“ASIC banned Mr Hanson over concerns that he allowed or caused withdrawals from client money trust accounts maintained by Australian Reliance and RFP and allowed or caused the misuse of these funds to meet the companies’ operating expenses,” the regulator said in a statement.
“As at 23 October 2014, Mr Hanson had allowed or caused funds totalling approximately $3 million to be used for purposes not permitted by the Corporations Act and the Corporations Regulations, which govern the use of monies held in trust accounts by AFS licensees.
“ASIC was also satisfied that Mr Hanson understood that misusing funds held in trust by Australian Reliance and RFP was a contravention by Australian Reliance and RFP of their obligations as AFS licence holders.”
Mr Hanson has the right of appeal to the Administrative Appeals Tribunal.
ASIC said its investigation into conduct by the officers of Australian Reliance and RFP was continuing but did not provide details.
Investors in Reliance Group included Jon Fogarty and David McCleery, who have been helping to fund legal actions against Messrs Donnelly and Hanson.
Their former auditor and lawyer are also enmeshed in the legal disputes.
Separately, Macquarie Bank has initiated legal action against Mr Donnelly after he allegedly failed to meet loan repayments.
