jail

-April-10 by Edited announcement


The former managing director of Chameleon Mining, Gregory Barnes, has today been sentenced to nine months jail for permitting false and misleading information to the Australian Securities Exchange.

Mr Barnes was sentenced in the NSW District Court after being found guilty by a jury.

His sentence follows an earlier guilty plea by former Chameleon director Landan Roberts to two counts of permitting false and misleading information to the ASX.

Mr Roberts was sentenced today to eight months jail with a non-parole period of five months.

The false and misleading information relates to the $3 million purportedly raised by Chameleon during in initial public offer in 2003, the Australian Securities and Investments Commission said.

As part of its IPO, Chameleon represented that it had issued 15 million shares to Zenith Development Company and A.C.N 103850406 Pty Ltd in consideration for $3 million.

ASIC contended that Chameleon did not receive payment for the shares issued to Zenith and ACN, and that Messrs Roberts and Barnes continuously represented to the ASX that Chameleon had the $3 million as cash or that it lent the $3 million back to Zenith and ACN.

It was alleged that as a result of the false representations, Chameleon managed to list and trade on the ASX for a period of 13 months without raising the minimum subscription amount.

Mr Roberts and Mr Barnes have been granted bail until their separate appeals are heard.

As part of his bail conditions, Mr Barnes was ordered to have two acceptable persons deposit $50,000 each, surrender any passports and report daily to his local police station.

Mr Roberts was ordered to have two acceptable persons deposit a total of $75,000, surrender any passports and report daily to his local police station. Mr Roberts was also ordered to prosecute his appeal as a matter of urgency.

Mr Barnes was also involved in separate legal action between Chameleon and Murchison Metals.

He was named as a defendant with Chameleon alleging that he and former Murchison director Philip Grimaldi had breached their duties in 2004 when Murchison used around $500,000 of Chameleon's cash and assets to help pay for the tenements, then valued at $1.1 million.

The tenements have become more valuable as a result of Murchison's mine operation, which is operated by half-owned subsidiary Crosslands Resources.

Mr Barnes was a director at Chameleon at the time.

Late last year, Mr Barnes agreed to pay $6 million to Chameleon in return for the company agreeing to discontinue the proceedings.