Noumi, formerly known as Freedom Foods, has been sued by the Australian Securities and Investments Commission (ASIC) along with its former MD and CEO Rory Macleod and former CFO Campbell Nicholas.
ASIC alleges breaches of continuous disclosure and company director and officer obligations, as well as false or misleading conduct.
The dairy and plant-based beverage company is accused of failing to disclose information about inventory values in its financial reports for the year to June 30, 2019, and the half-year to December 31, 2019.
Freedom Foods changed its name to Noumi in November 2021, after having to restate several years of accounts and book $590 million in write-downs after a nine-month suspension in ASX, reports The AFR.
Sarah Court, deputy chair of ASIC, said directors and officers have a responsibility to guarantee that their organisations comply with the law, and in this case, the former CEO and CFO of Freedom Foods failed to disclose a significant write-down, leading to an uninformed market.
“ASIC alleges Freedom Foods’ former CEO and CFO misled investors, auditors and directors, and allowed their company to breach continuous disclosure laws,” said Court.
The corporate regulator also alleged that Macleod and Nicholas gave false or misleading information to auditors, directors, and shareholders of Freedom Foods, including the ASX, by representing the full-year and half-year reports were accurate.
Court added that fighting governance failures is a key priority for the government regulator.
“When directors and officers fail in their obligations, as we allege in this case, they not only cause harm to investors by denying them the information they are entitled to, they also erode confidence in Australia’s financial markets,” she explained.
“ASIC is continuing its focus on potential breaches of company officer and director duties, and we will continue to take court action seeking penalties and other sanctions in appropriate matters.”
ASIC is seeking declarations of contravention, financial penalties, disqualification orders and costs. The date for the first case management hearing has yet to be scheduled.
