"Encouraging Africa's most notorious MLM network of desperately impoverished people to register and signup family & friends as registrants who have no intention of converting to subscribers, but are only registering en-masse to win prizes for who caused the most registrations is itself problematic behaviour for any Listed Company. Specifically, EM1's problem is it conflated registration with "early subscriber interest".
Treating the mass-registration event by an army of Africa's poorest people which was manipulated into existence by EM1\Crowd1 as a potential revenue source worth reporting to the ASX, and then trying to label it anything so simple as a misunderstanding by market participants of the particulars in an Announcement is also a problem. Dirt-poor Africans don't have $12/month disposable income to spend, but a company went from next-to-nil market cap to 85mil in a few months on the strength of their involvement.
Additionally, failure to implement proper information reporting systems which provide accurate actionable information as your source of factual reporting to the Market is a breach of statutory duties of care and diligence under section 180(1) (in the case of a listed company), which comes with an immediate $200,000 fine attached for the Company and Directors.
"The pre launch objective was to raise awareness and there was no obligation to subscribe"...
EM1's pre-launch intent is not actually relevant - they made a statment to the ASX which the ASX has not yet been satisfied by. EM1's failure to take reasonable steps in ensuring that the information provided to market was not false or would mislead is one issue they are yet to resolve. EM1 making any representation about the future without reasonable grounds is assumed to be a breach by the regulator just on-principle, and it is then up to the Company to satisfy regulators that they did not breach.
Knowingly or carelessly making a false or misleading statement that is likely to induce persons to acquire or dispose of financial products or to have the effect of increasing, reducing, maintaining or stabilising the price for trading in financial products on a financial market, is another issue yet to be resolved - at this point nobody is exactly sure when EM1 last traded at a Fair Market Value.
(20min delay)