CEO had been accused of improper conduct related to a board election
The Commonwealth Director of Public Prosecutions (CDPP) has withdrawn the charges against Peter Challis, former CEO of WAW Credit Union Co-Operative Limited, according to a notice from the Australian Securities and Investments Commission.
The charges were related to a single count of failing to discharge his duties in good faith in the best interests of the corporation, following an investigation by ASIC.
Peter Kevin Challis, 59, from Albury, New South Wales, appeared before the Wodonga Magistrates' Court on a criminal charge after an ASIC investigation. The charge stemmed from irregularities discovered during the elections held by WAW in November 2015. The voting process was conducted electronically, with WAW members using their personal details to access an online portal and cast their votes.
After the election, the WAW board identified irregularities, including 627 ballots cast from the same internet protocol (IP) address.
During the board election, four candidates stood for two vacant positions: Timothy Frazer, David Iverson, Ali Pockley, and Tracey Toohey. After the election, Frazer and Iverson were declared the successful candidates and appointed to the WAW board. However, without the votes from the single IP address, Frazer would not have been elected, and Toohey would have been elected instead.
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The board initiated internal and external investigations to determine the owner of the IP address. ASIC alleged that Challis, as the CEO of WAW, knew the owner of the IP address but failed to inform the board. ASIC further alleged that Challis either dishonestly or recklessly failed to exercise his powers and fulfil his duties as CEO in the best interests of the corporation.
Challis was charged with contravening section 184(1) of the Corporations Act 2001, which carries a maximum penalty of five years' imprisonment, 2,000 penalty units, or both. He resigned as the CEO of WAW in September 2016.
In July 2018, another individual, Neil Evans of Wodonga, Victoria, pleaded guilty to unauthorised voting in the WAW board election, according to ASIC. Evans was sentenced to a 12-month good behaviour bond, which included paying $12,000 into the court fund and a prohibition from providing financial advice to WAW customers during the bond period.
The charges against Challis were withdrawn after Judge Leighfield of the County Court of Victoria ruled, prior to the trial, that Challis did not have a relevant duty at law in the circumstances of the case, ASIC reported. In response to the ruling, the Crown filed a nolle prosequi, a formal notice to the judge indicating that they will no longer prosecute the case against Challis.
Last month, ASIC announced that it had banned Queensland director Maree Narelle Hawcroft from controlling an entity involved in a financial services business. The regulator also recently announced the appointment of three new commissioners.
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