ASIC has disqualified Mark Zappia of Virginia, Northern Territory, from managing corporations for five years, after his involvement in five failed companies.
Between 2008 and 2019 Mr Zappia was a director of Territory People Pty Ltd, MZ and HC Removals Pty Ltd, TER Transport Pty Ltd, Aussiemove NT Pty Ltd, and TwentyForty Transport Pty Ltd.
All five failed companies operated in the Northern Territory or South Australia and were involved in the transport or removals industries.
At the time of ASIC's decision, the five companies owed a combined total of $7,049,582 to unsecured creditors. This included $2,227,973 owed to the ATO, $35,724 owing to the Department of Employment and Workplace Relations regarding employee entitlements and $5,597 owing to the Government of South Australia and at least $1,204,754 owing to trade suppliers.
ASIC found that Mr Zappia acted improperly and failed to meet his obligations as an officer when he:
- failed to ensure that all companies paid their tax debts,
- failed to ensure that Territory People and MZ & HC Removals complied with their statutory lodgement obligations with the ATO,
- failed to maintain books and records for Territory People and MZ & HC Removals,
- improperly used his position of director of Territory People by allowing loans to be made to himself and his father Mr Domenico Zappia from the company bank accounts without loan agreements in place,
- improperly used his position of director of Territory People to use company money to pay for his child support payments,
- improperly used his position of director of Territory People by removing company property that the liquidator had arranged to be sold, before it could be sold,
- failed to submit a ROCAP for Territory People; and
- allowed Territory People and MZ & HC Removals to continue to trade while insolvent.
In disqualifying Mr Zappia, ASIC relied on supplementary reports lodged by liquidator Shane Deane of Dye & Co Pty Ltd, and Glenn Franklin and Jason Stone of PKF Melbourne.
ASIC assisted Mr Deane to prepare the statutory reports by providing funding from the Assetless Administration Fund.
Mr Zappia is disqualified from managing corporations until 7 July 2030.
Mr Zappia has the right to seek a review of ASIC's decision by the Administrative Review Tribunal.
Background
Section 206F of the Corporations Act allows ASIC to disqualify a person from managing corporations for a maximum period of five years if, within a seven-year period, the person was an officer of two or more companies, and those companies were wound up and a liquidator provides a report to ASIC about each of the company's inability to pay its debts.
Through enforcement action against selected directors who contravene s206F, ASIC demonstrates that there are appropriate consequences for the mismanagement of small and large companies. ASIC continues to take targeted action against individual directors to protect the wider public, employees and other businesses against the future mismanagement of companies.
ASIC maintains a banned and disqualified persons register that provides information about people who have been disqualified from:
- involvement in the management of a corporation,
- auditing self-managed superannuation funds (SMSFs), or
- practising in the financial services or credit industry.
