Urban renewal chief facing corporate ban

THE head of urban renewal authority Places Victoria, Liberal Party stalwart Peter Clarke, faces a ban from corporate life over the failure of a $550 million retirement village group.

By · 28 Aug 2012
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clock 28 Aug 2012
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THE head of urban renewal authority Places Victoria, Liberal Party stalwart Peter Clarke, faces a ban from corporate life over the failure of a $550 million retirement village group.

In court documents, the corporate regulator alleges Mr Clarke, along with former Howard government health minister Michael Wooldridge and other former directors of Australian Property Custodian Holdings, made improper use of their positions when approving a $33 million payment to managing director Bill Lewski.

APCH ran the Prime Retirement and Aged Care Property Trust, which collapsed in October 2010 after nervous lenders appointed receivers over its retirement villages.

The board allegedly approved a $33 million "listing fee" that Prime Trust paid to Mr Lewski after Prime Trust floated on the stock exchange in 2007.

In an originating motion filed last Tuesday, the Australian Securities and Investments Commission alleges Mr Clarke, Dr Wooldridge, Mr Lewski and two other directors each "made improper use of his position", "failed to act in the best interests of the members of the Prime Trust" and "failed to take all steps that a reasonable person would take" in his position.

ASIC has asked the Federal Court to ban all five from managing corporations and order them to pay a pecuniary penalty. It did not say how long the bans should run nor specify how much the men should pay.

Mr Clarke quit the Melbourne City Council last year after being appointed chairman of Places Victoria by Premier Ted Baillieu without going through a formal selection.

The authority replaces VicUrban and is responsible for major projects, including the 240 hectare new suburb at Fishermans Bend and a $300 million bid to revitalise the unpopular Docklands precinct.

Mr Clarke said he was not aware of the lawsuit until contacted by The Age.

"Once we see what they've got to say, we'll refer it to lawyers, but I'd certainly be denying I've got any responsibility for them," he said.

A spokeswoman for Planning Minister Matthew Guy said the government "will not be commenting on a matter that is now before the courts".

Mr Lewski's solicitor, Sam Bond, and Dr Wooldridge, who chaired the APCH board, did not return calls. The Age could not reach the other directors named by ASIC, real estate agent Mark Butler and former 7 Eleven franchising manager Kim Jaques.

A ban from corporate life would see Dr Wooldridge ejected from the boardrooms of ophthalmology group Vision Eye Institute, Australian Pharmaceutical Industries, anti-wind farm group the Waubra Foundation and the Royal Melbourne Tennis Club.

The Prime Trust Action Group, which claims to represent more than 70 per cent of unit-holders, welcomed ASIC's move but said more needed to be done.

"If ASIC are successful, it will provide a helping hand to other actions in terms of not having to re-establish facts," group principal Steve O'Reilly said. "It's a very useful first step, if nothing else it's quite positive."

The action group is also concerned about $60 million Mr Lewski reaped in 2008 when one of his companies sold rights to manage 12 Prime Trust retirement villages to Babcock & Brown.

Babcock & Brown's chief executive was Phil Green, the brother of Max Green, a former business partner of Mr Lewski's who was murdered in Cambodia in 1998 after allegedly defrauding more than $30 million from a trust fund.

"He [Mr Lewski] did not pay for those management rights, we understand," Mr O'Reilly said.

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