Michael Pascoe writes:

ASIC’s case against wannabe iron ore miner
Fortescue and its colourful boss Twiggy Forrest over misleading statements has
taken an interesting turn with the watch pup seeking stiffer penalties long
before it gets to court. But it’s the date of that court
appearance that is the bigger scandal.

The West Australian‘s John Phaceas reports
ASIC has quadrupled the penalties it’s seeking, asking for fines of $8
million for Fortescue and $7.6 million for Forrest – if it wins the
case, of course. It also wants Forrest disqualified from managing
companies,
all over claims Twiggy made between August 2004 and 2005 that he had
Chinese
companies locked into developing an iron ore project. Notes The Worst:

If ASIC’s case succeeds, the fine would dwarf the $9 million
levied against Rodney Adler and Ray Williams over the collapse of insurer HIH,
though be only a fraction of the $92 million being sought from the directors of
failed telecommunications company One.Tel. It also represents a huge increase over the $3.6 million initially sought by ASIC
when it filed its initial claim against Mr Forrest and the company in March.

The real shock in the story though is
buried in the last sentence – the case won’t be heard until late next year.
Given that ASIC believes Forrest shouldn’t be allowed to manage companies, such
a long wait for trial over something that happened more than a year ago seems a
little less than highly efficient.

Forrest and Fortescue promise as usual to
vigorously contest the proceedings, which means they could drag on for many more
months. Maybe by the time the iron ore dust has settled, sometime in 2008, four
years after the deed, Twiggy might finally have his mine anyway – albeit
without those claimed Chinese partners.

Right on deadline, ASIC tells us a date hasn’t been set
yet for a trial, so the late-2007 figure seems to be The Worst’s estimate. The
longer the trial, though, the further away the starting date. And then there’s
the chance of an appeal – which could mean 2008 is optimistic.

Peter Fray

Save up to 50% on a year of Crikey.

This extraordinary year is almost at an end. But we know that time waits for no one, and we won’t either. This is the time to get on board with Crikey.

For a limited time only, choose what you pay for a year of Crikey.

Save up to 50% or dig deeper so we can dig deeper.

See you in 2021.

Peter Fray
Editor-in-chief of Crikey

SAVE 50%