As mentioned before, I have sent the following letter to Scott Morrison and Chris Bowen.
I know I will attract a tirade from the dwindling band of true believers who will likely blame me when this dog goes under.
Notwithstanding, some of you wanted me to post it here as an FYI, as some of you were considering writing also seeking action.
As a shareholder who has blown some reasonable coin it gives me no pleasure doing this. But enough BS is enough BS.
As mentioned, if we want some traction I suggest a few of you consider sending letters of your own. Emails where to send are included below.
Good luck to all, elsewhere!!!!
CC
The Hon. Scott Morrison MP
Treasurer
cc: Chris Bowen, Opposition Treasurer
Dear Treasurer,
Earlier this year your Government trumpeted how ASIC (AKA “the tough cop on the beat”) was equal to the task of regulating the banks to heamce-anchord off calls for a Royal Commission.
I write as a concerned shareholder of a junior resource company (FairStar Resources Pty Ltd. ASX: FAS) that appears to enjoy breaching the Corporations Act with impunity while attracting “tut tut” letters from ASX and nil interest from the “tough cop on the beat”.
Surely retail investors in small cap stocks also deserve protection from Companies that appear to flout Corporate regulations, issue a slew of market updates about a slew of bogus funding deals that all collapse, spew out Quarterly reports claiming the aforementioned bogus funding deal(s) will arrive “soon” and “shortly”, while trading with $10 million-plus in debts with
NIL cash balance.
ASX wrote to FAS on May 26 amid concerns it
“may be insolvent for the purposes of the Corporations Act”. ASX also noted the Company
“has reported short term secured financing facilities payable of amounts greater than $5,000,000” dating back to at least September 2013.
It seems obvious no entity can pay its debts as and when they fall due with a NIL cash balance. FAS simply denied it was trading while insolvent to fob ASX off.
ASX also noted that FAS failed to make material updates to the market about a stalled convertible note funding deal (I-World).
“The clear implication of this statement is that the I-World Convertible Note Agreement is no longer on foot, despite the statements to the contrary in FairStar’s First Response and FairStar’s Second Response. This fact is plainly material and should have been disclosed to the market immediately FairStar became aware of it under Listing Rule 3.1.”
Once again, despite breaching the listing rules there have been no consequences.
Retail investors like myself rely on accurate and timely material disclosure upon which to base investment decisions. The integrity of the platform is built on regulators ensuring entities comply and “do the right thing”.
I am out of pocket, as are more than 5000 other investors. I accept this as part of the capricious world of investing, although I based these decisions on a slew of “material” disclosures that all turned out be pipe dreams. ASX allowed all of these to appear on the platform.
What I find difficult to accept is how the regulators that are supposed to ensure a debacle like FairStar is stopped in its tracks are asleep at the wheel. ASIC rightly examined Padbury Mining following the hysterical $6 billion funding announcement (sourced by the same party FAS was involved with, Alliance Super Holdings, and also allowed to appear on the platform by ASX).
I suggest your “tough cop on the beat” takes a look at FAS to try and restore some confidence in the small cap market.
Regards,
