Daniel Kirby, a former director of collapsed FX/CFD provider Berndale Capital, has pleaded guilty to multiple charges of financial misconduct, Australian authorities announced today (Wednesday).
Former Berndale Director Pleads Guilty to Financial Misconduct Charges
Kirby entered his plea early this week in the Melbourne Magistrates' Court, admitting to one count each of dishonest conduct related to financial services, dishonest use of his position as a director, and providing false or misleading information to an auditor.
The guilty plea comes nearly six years after the Australian Securities and Investments Commission (ASIC) canceled Berndale's financial services license in November 2018, citing compliance failures and inadequate staff training.
According to ASIC, Kirby illegally transferred company funds for personal benefit and to associates both before and immediately after the license cancellation. Some transfers reportedly occurred within hours of the regulatory action.
Authorities also allege that Kirby provided false documentation to Berndale's auditor regarding overseas bank account balances. These accounts were either nonexistent or contained far less money than reported, violating requirements for the company to maintain minimum asset levels.
“Berndale’s Australian financial services licence required it to maintain a minimum level of net tangible assets of at least the greater of $1 million or 10% of its average revenue,” ASIC commented in the press release. “The relevant overseas funds and accounts either did not exist or were grossly inaccurate.”
Kirby's case has been referred to the Federal Court of Australia for sentencing, with an initial appearance scheduled for September 30. This marks the first ASIC prosecution to proceed in the Federal Court under recent legislative changes expanding its jurisdiction over corporate criminal matters.
The Collapse of Berndale
In a related development, Stavro D'Amore, another former Berndale director charged alongside Kirby, has pleaded not guilty and been committed to stand trial. D'Amore was previously banned from providing financial services for six years in 2018.
D'Amore was previously associated with the broker FXTG, which also reportedly came under the scrutiny of the Australian regulator. In 2016, there were reports that the firm allegedly owes investors around $2 million. It is worth noting that Kirby was also connected with FXTG as the Chief Operations Officer.
The collapse of Berndale and its associated companies led to their liquidation in 2019, a process that remains ongoing. Creditors and former clients of Berndale have been advised to contact the appointed liquidators for further information.
However, in 2020, The Australian Financial Complaints Authority (AFCA) indicated that recovering funds belonging to clients was unlikely.
Recently, Finance Magnates reported on another high-profile case in Australia. Specifically, Tony Iervasi, the former director of Courtenay House, has been sentenced to 11 years behind bars. The fraud, which lasted for over half a decade, led to a net loss of $54 million for approximately 585 investors.
