A former CEO who is currently serving a four-year jail sentence for conspiring to defraud CBA and his company will remain in prison after his conviction and sentence appeal was dismissed by the courts.
In 2017, the former CEO and executive chairman of failed health-food chain Healthzone Ltd, Peter David Roach, was found guilty by a jury of conspiring with a fellow director, Ge Wu, to defraud the Commonwealth Bank of Australia (CBA) and Healthzone by obtaining a $1-million loan.
According to the Australian Securities and Investments Commission (ASIC), the $1-million loan was reportedly awarded to Healthzone for on-lending to Mr Roach to buy shares in Healthzone; however, an investigation found that the majority of the funds ($900,000) were instead used by Mr Roach to settle a personal property issue, with the balance used to pay personal and business expenses.
Mr Roach reportedly then authorised two ASX announcements that falsely stated that he had purchased shares in Healthzone and was found to have falsified company documents, including altering legal advice provided by Healthzone’s lawyers.
In December 2015, Mr Roach was sentenced to a total of 18 months of imprisonment and served six months after pleading guilty to conspiring with two of his former directors to commit market manipulation offences in relation to the shares of Healthzone.
Further, on 27 November, Mr Roach was then sentenced to four years and three months of imprisonment for fraud and related offences.
On 31 October 2018, Mr Roach filed with the Criminal Court of Appeal a notice of appeal against his conviction and sentence.
The hearing of appeal took place on 23 April, in which it was argued that the falsification of documents was a technical breach.
However, the appeal was dismissed by the NSW Court of Criminal Appeal on 19 July, after the court found that any such characterisation of those offences as “technical” or “trivial” was “wholly inapt and unjustified”.
In dismissing the appeal, the court found that the sentence imposed was not manifestly excessive and lay comfortably within the reasonable exercise of sentencing discretion in the circumstances of the case.
ASIC commissioner Cathie Armour said she believes the court’s decision to deny the appeal and honour the original sentence “sends a clear message that the consequences of this type of misconduct are serious”.
“Mr Roach’s conduct was particularly egregious given his significant position as the executive chairman and chief executive officer of a publicly listed company,” Ms Armour said.