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Legal spectator sport warrants close attention

THE race for evidence following the HIH corporate collapse is becoming a spectator sport, watched by many interested punters. While Mr Adler and Mr Williams complain about the seizure of their lawn mowing and pool chemical receipts, they are challenging the warrants because their legal advisers have realised that some of the most seemingly irrelevant items seized could land them in gaol at a later date.

By challenging the warrants in the Federal Court, any proceedings against the two will be considerably complicated and slowed down.

Criminal lawyer Mr John Prior said such tactics were unusual and typically restricted to those on serious corporate charges, like the HIH directors, or serious drugs charges.

“Unlike the US TV shows, challenging search warrants is relatively rare in WA,” Mr Prior said.

“Only clients with strong financial backing have the resources to spend on protracted objection proceed-ings.”

“The success of these challenges seemed to be limited because judges have a wide overriding discretion to allow in evidence.”

Directors of failed entities should routinely expect a knock on the door, with a person bearing a search warrant, which could emanate from a number of different sources – ASIC (civil or criminal invest-igations), receivers, liquidators, trustees in bankruptcy, the Aust-ralian Taxation Office, or in this case, officers of the Royal Commission.

As an investigatory tool, the search warrant holds prime position in any arsenal.

For those unwilling to follow the lead of the failed Western Women’s chief executive officer Robyn Greenburg, who destroyed and dumped incriminating documents, compliance is the only realistic option. However, law watchers will probably notice that co-operation seems to be followed by technical objections, when the stakes are high.

The end of the 1980s, when Australia witnessed the last era of large-scale corporate collapses, is worth reviewing for its history lesson.

Many of the failed entrepreneurs, such as Alan Bond, Laurie Connell, Robyn Greenburg, Russell Goward and politicians such as Brian Burke and David Parker, were pursued on big ticket items for large scale losses, but their ultimate demise was founded on smaller items seized by search warrants.

While the corporate and banking documents show the regulators and the insolvency experts the money trail, as the money has usually evaporated, it is easier to “obtain justice” by concentrating on more simple offences like perjury.

Russell Goward, former director of the failed Westmex group who went bankrupt in the early 1990s owing a personal debt of $33 million, went to prison for perjury relating to assets he had concealed from his trustee in bankruptcy.

When his diary was seized, details of the sale of the assets landed him in gaol for several years.

Mr Burke’s stamps and Mr Parker’s garbage bag of cash were all found on execution of warrants.

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