David was a non-executive director of HIH Insurance and an officer of a HIH subsidiary, HIHC....

David was a non-executive director of HIH Insurance and an officer of a HIH subsidiary, HIHC. David in his capacity as an officer in the subsidiary organised a loan from the subsidiary to another associated company, PEE, which he controlled. PEE used the money to buy shares in HIH and boost the market price of that share. Loan money was used to buy shares in David’s own company, and further funds were lent indirectly to David himself. ASIC wants to file a law suit against David. Advice ASIC.

Expert Solution

Answer : in this case David is fraudulent manner missused the powers and missappropriated funds of subsidiary by his power

AISC must file law suit against David he is liable with imprissionment and fine with both

The auditor must qualifiy report and must state the reasons

Thank you hope this helps you

ekkarill92 answered 2 years ago

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