Former SEO company director found guilty after withdrawing $29,000 from the business’s bank account for personal use
Monday, October 12, 2015/
The former head of a business specialising in search engine optimisation has been found guilty of breaching his duties as a company director.
Oliver Wood, the former director of SEO Company Pty Ltd, was convicted by a jury in the Perth District Court earlier this month after withdrawing more than $29,000 from the company’s bank account for his personal use.
The eight-day trial resulted in Wood being convicted of three counts of using his position as director of SEO Company to dishonestly gain an advantage, according to a statement from the Australian Securities and Investments Commission.
The verdict comes after Wood pleaded guilty to four counts of making a false statement in a document lodged with ASIC.
Wood is currently on bail and will be sentenced later this week.
The Director of Public Prosecutions is prosecuting the matter.
This is not the first time this year an investigation by the corporate watchdog has led to a guilty verdict against a former company director.
ASIC regularly pursues action against company directors it believes have breached their duties or made false statements.
In July, the former director of a collapsed New South Wales beauty chain was jailed for two years.
The sentence was handed down after the man pleaded guilty to misappropriating $2.6 million from the business shortly before it was placed in liquidation.
Ursula Hogben, general counsel at LegalVision, told SmartCompany directors have a legal duty to a company as outlined in the Corporations Act.
“The key duties include to act in good faith, to avoid conflicts of interest, a duty not to make improper use of information or position and a duty to ensure the company keeps accurate financial records,” Hogben says.
“In this case, Mr Wood withdrew money from the company for his own personal use. This could be a breach of the duty not to make improper use of his position, and or could have caused detriment to the company by withdrawing the money for personal use to gain an advantage for himself.”
Hogben says founders and managers need to understand any payments made from a company needs to be for a proper use.
“For example, individuals can be paid salary, shareholders can be paid dividends, and – in certain circumstances – a company may make a loan to an individual,” she says.
“All transactions by a company need to withstand scrutiny that he purpose was a proper purpose, and the amounts were not in bad faith and or improper.”
SmartCompany was unable to contact Oliver Wood prior to publication.