A war of words erupted between ASIC and collapsed financial advisory firm Storm Financial (Storm) just hours before the regulator filed for the company to be placed in liquidation.
ASIC gave Storm founders Emmauel and Julie Cassimatis until 3pm on Wednesday 18 March to comply with a number of undertakings or face the possibility of the company being wound up, according to a fax from the corporate regulator to Storm's legal representatives, Russell and Company Solicitors.
"We are astonished that ASIC would give us less than two hours notice of what is evidently going to be another application to a court," the faxed response from Storm's representatives said.
ASIC's decision to move on liquidation orders came after the corporate regulator found Storm's deed of company arrangement (DOCA) placed on the Cassimatis' personal website did not provide a fair and balanced summary of the terms of the DOCA.
The regulator's specific concerns centred on the mention of a $2 million payment to the administrators and costs associated with public examinations.
Comments made in the DOCA regarding public examinations, which claims the costs of the examinations will be limited to $150,000, were also misleading, ASIC said.
"Given the complexity of the Storm advisory model, the sum of $150,000 to fund the legal and professional costs of conducting these examinations is likely to be substantially inadequate," the regulator said.
Despite the Cassimatis refuting ASIC's claims, the regulator filed for the firm to be placed in liquidation late on Wednesday.
Late yesterday the wholly-owned subsidiary of Storm, Victorian Families Retirement Investment Group, was placed in provisional liquidation.
