chameleon directors charged

Thursday 20 September 2007


ASIC has laid charges against the former directors of gold exploration company, Chameleon Mining NL (CHM), for allegedly providing false and misleading information in relation to an Initial Public Offering (IPO).

Mr Landan Roberts of Dee Why, New South Wales, and Mr Gregory Barnes of Waterford, Western Australia, face charges relating to providing false and misleading information to the Australian Securities Exchange (ASX Limited) and the company’s auditor between July 2003 and December 2004.

These charges follow an ASIC investigation launched in February 2005 after a referral from the ASX.

ASIC alleges that Messrs Roberts and Barnes made false or misleading representations concerning $3 million purportedly raised by CHM during an IPO in 2003.

As part of its IPO, CHM represented that it had issued 15 million shares to Zenith Development Company Limited (Zenith) and A.C.N 103850406 Pty Ltd (ACN) in consideration for $3 million. ASIC alleges that CHM did not receive payment for the shares issued to Zenith and ACN, and that Messrs Roberts and Barnes continuously represented to the ASX and CHM’s auditors that CHM had the $3 million as cash or that it lent the
$3 million back to Zenith and ACN.

The matter returns to Sydney’s Downing Centre Local Court on 11 December 2007.

The Commonwealth Director of Public Prosecutions is prosecuting the matter.

Background

On 6 August 2003, the ASX issued a market release to the effect that CHM had been admitted to the official list with trading to commence on the 12 August 2003. It was stated that CHM issued 33,462,596 ordinary shares fully paid at 20 cents per unit. The 15 million shares issued to Zenith and ACN in consideration for $3 million represented the bulk of funds raised by CHM and were essential in ensuring CHM met the minimum subscription amount to qualify for ASX listing.

On 30 September 2004, the securities of CHM were suspended from the official quotation following adverse media articles and preliminary inquiries undertaken by the ASX. On 22 December 2004, the Supreme Court of New South Wales ordered CHM be wound up. Mr John Vouris of Vouris & Bell was appointed liquidator.

Following a meeting of CHM creditors on 13 September 2005, it was resolved that the company execute a Deed of Company Arrangement, which led to another company purchasing the company and taking over its assets. On 14 September 2007, CHM securities were reinstated to the ASX official quotation under new management.