Perth company director jailed

Former Perth company director David Alan Zohar has been sentenced to 14 months in prison for providing false and misleading information to the Australian Securities Exchange.

Mr Zohar will serve a minimum of five months before being released on a $5,000 recognisance, which requires good behaviour for 12 months.

He pleaded guilty to three counts of providing false and misleading information to the ASX in the Perth District Court in February this year after an investigation by the Australian Securities and Investments Commission.

The charges related to his involvement in listing the former bauxite and base minerals exploration company Aluminex Resources on the ASX in September 2008.

Mr Zohar’s guilty plea followed his resignation from the boards of exploration companies Iron Mountain Mining, Red River Resources, Elysium Resources, and Eagle Nickel.

Aluminex Resources was suspended from trading within a month of it listing in 2008 and ordered to make full refunds to all share owners because it did not meet the requirements for listing.

In Septmeber 2008, Aluminex Resources said it had reached its minimum subscription level of $2.5 million after extending a deadline for late applications for its initial public offering.

However, after its suspension it announced in November that it might not have received cleared funds in excess of the $2.5 million minimum subscription amount specified in its prospectus.

This resulted in ASIC requiring it to refund all who had subscribed for shares.

In its short life on the ASX, Aluminex Resources shares never traded above 15 cents after being offered at 40 cents each.

In handing down his sentence today, Judge Anthony Derrick said the enforcement of provisions under the Corporations Act was vital to maintaining market integrity.

ASIC commissioner John Price said the sentence highlighted the fact that jail time was a "very real possibility" for those who did not adhere to their obligations.