The Australian Securities and Investment Commission has cancelled the registration of a former Sydney-based liquidator, after he was jailed earlier this year for lying to authorities about traffic offences.
Peter Grealish was once employed as a liquidator with Grant Thornton and BDO, but in April this year he was sentenced to two years in prison (with a non-parole period of one year) by the New South Wales District Court.
The move by ASIC is a first in banning a liquidator for legal offences relating to their private life. Such a punishment is common among law-related professions.
Grealish pleaded guilty to four counts of making a false statement to obtain financial advantage and one count of giving false or misleading evidence at a hearing of the Police Integrity Commission.
The former liquidator allegedly lied to authorities to avoid fines for a number of traffic offences and gave false statements saying another person was driving the vehicle at the time each offence was committed.
The case draws parallels with the prosecution of former Federal Court judge Marcus Einfeld, who in 2009 was sentenced to three years in prison for perjury and perverting the course of justice over a $77 speeding ticket.
In August 2007, Einfeld claimed the car had been driven by one of his friends at the time a speed camera caught him speeding. In reality, that friend had been killed in a car accident in the United States in 2003.
Lawyers and liquidators are expected to be honest at all times in both their professional and private lives.
“The charges that led to Mr Grealish’s jailing suggest a lack of honesty. Honesty is an essential trait for liquidators as gatekeepers in the financial services industry,” ASIC commissioner John Price said in a statement.
The Insolvency Practitioners Association of Australia, of which Grealish is a member, is also in the process of cancelling his membership and IPA president David Lombe told SmartCompany honesty is fundamental to the profession.
“It’s very hard for your personal and professional ethics not to cross over.”
“It’s just very unfortunate… He’s made some grave mistakes and betrayed his own personal ethics and for people who lie and give false stat declarations, this is the only outcome,” he says.
Lombe says each year when a liquidator applies for their registration with ASIC they must complete a set of questions, including one relating to criminal offences.
“This serves as a constant reminder that if you commit an offence, your licence will be cancelled,” Lombe says.
Grealish was employed with Grant Thornton between October 2007 and November 2012, but when the firm became aware of the charges he was asked to resign.
“The charges were unrelated to his work, but his continued employment was unacceptable to the firm. He was asked to resign and did so,” said Grant Thornton managing partner Paul Billingham in a statement.
Following his employment with Grant Thornton, Grealish went on to work with BDO, but he was fired on April 23, 2013, three days before he was handed his prison sentence.
“We can confirm that Peter Grealish contracted to the firm for a short period of time. As a result of these allegations coming to light, however, his contract was terminated immediately,” BDO said in a statement.
The section of the Corporations Act under which Grealish’s registration has been cancelled only provides for cancellation and does not give any terms for how long this cancellation is in place.
Grealish could theoretically reapply to be an official liquidator, but the legislation makes provisions that sufficient time must have elapsed before prior cancellations are no longer a relevant consideration to ASIC.
ASIC conducts an annual report on the supervision of the nation’s liquidators and this year’s report released in May revealed that in 2012, 19 registered liquidators were formally investigated.