Businessman In Court Following Canada Extradition
Businessman In Melbourne Court On ASIC Charges Following Extradition From Canada
Mr Gabrial Neil Pennicott, formerly of Melbourne, Victoria, appeared in the Melbourne Magistrates Court on 21 December 2007 on charges brought by the Australian Securities and Investments Commission (ASIC) following his extradition from British Columbia, Canada.
Mr Pennicott has been charged with a total of 47 charges under the Corporations Act, Commonwealth Criminal Code and Victorian Crimes Act. A summary of the charges follow:
* thirteen charges of inducing a person to deal in a financial product by making or publishing a statement, promise or forecast if the person knows or is reckless as to whether, the statement is misleading, false or deceptive contrary to section 1041F of the Corporations Act;
* eleven charges of attempting to induce a person to deal in a financial product by making or publishing a statement, promise or forecast if the person knows or is reckless as to whether, the statement is misleading, false or deceptive contrary to section 11.1 of the Criminal Code and section 1041F of the Corporations Act; and
* six charges of dishonestly using his position as a director, other officer or employee of a corporation contrary to section 184(2) of the Corporations Act;
* four charges of dishonestly obtaining property by deception contrary to section 81 of the Crimes Act;
* six charges of dishonestly obtaining a financial advantage by deception contrary to section 82(1) of the Crimes Act; and
* seven charges of attempting to dishonestly obtain a financial advantage by deception contrary to section 321M of the Crimes Act and section 82(1) of the Crimes Act.
The charges relate to allegations that Mr Pennicott:
* transferred shares owned by companies he controlled between these companies at artificially inflated prices so as to change the balances of the inter-company loan accounts between the companies. ASIC alleges no money was paid for the shares and the consideration for the shares were recorded by adjusting book entries in the inter-company loan accounts. The value of these transactions was $2,465,000;
* transferred and attempted to transfer shares at artificially inflated prices to repay and attempt to repay amounts owed to investors in a company he controlled in lieu of repaying the monies owed. The monetary value of these transactions was $1,238,456.79;
* transferred shares at artificially inflated prices to himself and one other person in lieu of being repaid amounts owed to them. ASIC alleges Mr Pennicott and the other person then transferred the shares to another company controlled by Mr Pennicott, which paid money for the shares to Mr Pennicott and the other person. The monetary value of these transactions was $125,000; and
* induced investors to acquire shares which were artificially inflated in price. The monetary value of these transactions was $200,000.
Mr Pennicott has been granted bail on conditions, including:
* a surety of $300,000;
* that he report three days a week to Surfers Paradise Police Station;
* that he surrender his passport; and
* that he not have any involvement, whether for remuneration or not, in the promotion of any company, security, derivative or investment opportunity.
A committal mention date was set for 17 March 2008 in the Melbourne Magistrates Court. The Commonwealth Director of Public Prosecutions is prosecuting the matter.
On 26 April 2007, Mr Pennicott was arrested in British Columbia, Canada, following a request by the Australian Government to Canadian authorities to issue a provisional arrest warrant. On 7 December 2007, Mr Pennicott consented to being extradited to Australia before the British Columbia Supreme Court and was placed into custody pending his extradition to Australia.