Keith James Flowers, formerly known as Nigel Flowers, of Bathurst, New South Wales, has been sentenced to three years and two months imprisonment, to be served by way of intensive correction order, and fined $9500 for acting dishonestly as a company director and stealing investor funds.
Between 1991 and 2012, Mr Flowers was the founder and director of Flowers Financial Group Pty Ltd (in liquidation) and Flowers Financial Management Pty Ltd (in liquidation), which specialised in providing financial advice to the medical and dental professions.
During 2011, Mr Flowers engaged in a scheme to raise seed capital to fund a proposed initial public offering by Avior Australia Ltd, which would have resulted in Flowers Financial Management amalgamating with other financial services companies. The scheme raised approximately $1.48 million from investors who had been long-term clients of Mr Flowers. These funds were collected in a trust account established by Mr Flowers.
In October 2011, investors were advised that the initial public offer was to be deferred and any remaining seed capital would be returned to investors.
Between June 2011 and May 2012, Mr Flowers dishonestly used his position as a director and stole money by transferring $209,500 from the trust account with the intention of gaining an advantage for himself and Flowers Financial Management.
Mr Flowers intensive correction order requires that he perform 500 hours of community service work.
The matter was prosecuted by the Commonwealth Director of Public Prosecutions after a referral from ASIC.
Background
ASIC’s investigation was assisted by a report from the liquidators of Flowers Financial Management. The liquidators received funding from the Assetless Administration Fund to prepare and report their findings to ASIC.
Mr Flowers pleaded guilty to the charges before the Downing Street District Court on 18 December 2020 (20-337MR).
In February 2012, Mr Flowers was made bankrupt and ASIC permanently disqualified Mr Flowers in June 2014 from providing financial services and banned him from engaging in credit activities (14-130MR).