Liquidator jailed for fraud

Disgraced liquidator Stuart Ariff is in prison awaiting sentence after a jury found him guilty of 19 counts of fraud yesterday in the NSW District Court.

Ariff, whose conduct triggered a parliamentary inquiry into insolvency last year, was found to have taken $1.18 million from a family investment company called HR Cook Investments, which was placed into liquidation in June 2006.

Ariff transferred $400,000 out of HR Cook and into the bank account of his practice, Stuart Ariff Insolvency Administrators and took a further $700,000 to pay legal bills for other companies where he was liquidator.

He transferred $50,000 to his mother, Barbara Ariff.

The Australian Securities and Investment Commission, which had banned Ariff as a liquidator in 2009, hit him with a compensation order of $4.9 million and bankrupted him, successfully applied yesterday for Ariff’s bail to be revoked.

Judge James Bennett noted that 13 of the 19 charges of which Ariff was found guilty carry jail terms of 10 years.

Judge Bennett said the prosecution had presented a formidable case.

”The allegations are serious allegations and upon the material that I have before me it would seem inevitable that the offender will suffer a period of incarceration,” the judge said yesterday.

Ariff will be sentenced on November 25.

The 13 charges relating to the transfer of the $1.18 million out of HR Cook carry maximum jail sentences of 10 years each.

Another six charges relating to making false statements in documents lodged with ASIC carry a maximum fine of $22,000 or imprisonment for five years or both.

The jailing of Ariff follows a long chase by ASIC, which took action against him after reports that he allegedly extracted $13 million from another company he oversaw as liquidator, although that company had only entered liquidation with debts of $5 million.

Ariff’s conduct led to a parliamentary inquiry into the insolvency sector which was told complaints were made about him as far back as 2005, although no action was taken by ASIC until 2009.