Two directors of Biosignal have reported the company to the...

Two directors of Biosignal have reported the company to the Australian Securities and
Investments Commission over related party and transparency issues.
In a letter to ASIC’s complaints division dated May 11, 2009, former chairman John Keniry
who resigned today, with founder and former chief executive officer Prof Peter Steinberg
who resigned last week (BD: May 21, 2009) said there were a range of issues relating to
the actions of Empire Investments that the regulator should investigate.
The complaint was made under the ‘Whistleblower’ provisions of the Corporations Act.
A spokeswoman for ASIC told Biotech Daily that the Commission had received the
complaint, but said: “We don’t comment on operational matters.”
In documents received by Biotech Daily, Dr Paul D’Sylva is cited as a principal of Empire
Investments.
Dr D’Sylva categorically told Biotech Daily on May 7 that he was not a director or principal
of Empire Investments. He restated this position on May 21, 2009.
The letter of complaint to ASIC details a series of events leading up to Empire nominating
three directors on April 28. Those directors resigned on May 7 and were replaced by three
further Empire-nominated directors (BD: May 7, 2009).
Documentation to ASIC shows that Biosignal was introduced to a US biopharmaceutical
company by Dr D’Sylva and that a merger as part of a broader $2 million capital raising to
be underwritten by Chimaera Capital would occur, along with the placement of 12,000,000
one cent shares to Chemventures, which would fund Biosignal to the proposed merger.
Along the way, Chemventures was replaced by Empire Investments, whose letter head
provides no address, nor an Australian Business Number.
Following the resignation of the first set of directors, the US biopharmaceutical deal fell
through leaving Empire with control of Biosignal through its majority of the board despite
holding only 9.2 percent of the company.
Chimaera Capital was also involved in Pharmaust at the same time as Dr D’Sylva was the
company’s managing director and one of the Empire-nominated directors at Biosignal
Manraj Khosa was Pharmaust’s company secretary.
In the letter to ASIC the two former directors voice concerns over a range of issues.
Biotech Daily attempted to contact Mr Khosa and Dr D’Sylva for comment but had not
heard back at the time of publication.
“We believe that the company should be put into a trading halt pending investigations by
ASIC,” Mr Keniry and Prof Steinberg said in their letter to ASIC.
Biosignal was untraded at 2.6 cents.