Victorian convicted for disposing money before bankruptcy

On 11 November 2019, Mr Paul Rossiter was convicted and fined $800 in the Geelong Magistrates Court after pleading guilty to two offences under Commonwealth bankruptcy legislation.

Mr Rossiter pleaded guilty to:

  • Disposing of property – specifically money – within 12 months of going bankrupt, and
  • Not fully and truly disclosing information about his financial affairs to his bankruptcy trustee.

Mr Rossiter was made bankrupt by the courts in June 2016. Once he was made bankrupt, his bankruptcy trustee took possession of his house.

When the house burned down in July 2017, the bankruptcy trustee made an insurance claim and $129,850 was deposited into a Suncorp mortgage account that Mr Rossiter could access.

Despite being told not to, Mr Rossiter went to a local Suncorp Bank branch and withdrew over $100,000 and transferred it into a NAB account.

The bankruptcy trustee was able to recoup $68,250.

During his bankruptcy, Mr Rossiter also failed to provide information about his financial affairs. He eventually provided information, but only after he was charged with offences under the Bankruptcy Act.

In sentencing, Magistrate McGarvie stated she did not accept that the accused was financially illiterate, as submitted by his defence, as he had successfully obtained a mortgage. She stated these were not simple matters before the court and a financial penalty was most appropriate in the circumstances.

Mr Rossiter was convicted, fined $800 and ordered to pay court costs of $481.28.

Mr Rossiter remains an undischarged bankrupt.

Gemma Denton, Director of Enforcement at the Australian Financial Security Authority (AFSA) explained that AFSA remains committed to stamping out misconduct in the personal insolvency system.

“People who are bankrupt, or are considering bankruptcy, need to understand that they must comply with the directions of their bankruptcy trustee,” Ms Denton said.

“If you do not comply with directions from your bankruptcy trustee, you run the risk of being investigated and prosecuted.

“Charges under the Bankruptcy Act are serious and can result in fines of over $10,000, or even gaol time.”

The matter was prosecuted by the Commonwealth Director of Public Prosecutions on behalf of AFSA.

- Ends -

Charges:

Bankruptcy Act 1966 (Cth)

Mr Rossiter pleaded guilty to two charges under the Bankruptcy Act 1966 (Cth):

Count

Offence

Description

Maximum Penalty

1

1 x s 265(1)(ca) of the Bankruptcy Act

Not fully and truly disclose to the trustee of his/her estate such information about his conduct and examinable affairs as the trustee required.

12 months and/or a fine of $12,600.00

2

1 x s 265(4)(a) of the Bankruptcy Act

Being a person after the presentation of a petition on which or by virtue of the presentation of which he or she became a bankrupt, dealt with property in excess of $20.00.

12 months and/or a fine of $12,600.00

Useful links:

AFSA Enforcement snap-shot 2018-19

In 2018-19, 96 persons were prosecuted for a total of 145 charges during the year. Of those charges, 11 were withdrawn, 122 proven with conviction, 4 proven without conviction, 7 were dismissed and 1 not proven.