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Commission bans finance company

The Securities Commission has stopped a company raising $15 million from the public.

Monday, March 19th 2007, 4:03PM
The Securities Commission has cancelled the prospectus of finance company Classic Capital. The prospectus was banned because it omitted material information.

Classic Capital’s sole director, Keith McCoy is bankrupt, banned from management, and facing charges of forgery and dishonestly using his position as a company officer, all in Australia. The prospectus did not state these facts.

“A prospectus must contain all material information about an offer of securities,” Securities Commission director of primary markets Kathryn Rogers says.

“McCoy’s bankruptcy and management ban relate directly to his competence to handle investors’ money and to run a finance company. The fact that he is facing criminal charges, although these have not yet been heard, would also be likely to influence people deciding whether or not to invest.”

McCoy told the commission that he is appealing the management ban and that the criminal case has not yet been decided. He agreed that the prospectus should be cancelled.

Classic Capital had been seeking to raise $15 million by issuing secured debenture stock.

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