The Registrar of Indigenous Corporations has begun proceedings in the Federal Court against directors of an indigenous housing organisation, alleging the directors mismanaged Canberra properties for their self-interest.
Registrar, Anthony Beven, has begun civil penalty proceedings against the three former directors of the Southside Housing Aboriginal Corporation, or Southside Housing.
Southside Housing was established 20 years ago as a not-for-profit corporation to provide affordable housing to Aboriginal and Torres Strait Islander people in the ACT.
But it has twice been placed under special administration over the last ten years, with the Registrar placing it under special administration for the second time in December 2013 after an examination of the corporation's books and records revealed a large number of serious concerns relating to poor governance and bad financial management.
During the special administration an investigation was also conducted with Mr Bevan subsequently applying to the Federal Court for declarations and an order disqualifying the three former directors from managing corporations registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006.
The Registrar is now seeking orders requiring them to pay a fine to the Commonwealth and compensation to Southside Housing.
Mr Bevan alleges that the three former directors, Fred Monaghan, Teresa Monaghan and Kim Peters controlled the corporation and ran it for their own benefit.
They lived in the properties owned by the corporation, did not pay rent and had the corporation pay part of their excess water charges.
Of most concern was that the directors allowed the corporation's seven houses to fall into disrepair with two declared uninhabitable. The ACT Government meanwhile, has taken back the houses into ACT housing stock and said they would be designated for indigenous use.
Significant expenditure is required to return the houses to a habitable state.
"This is an unfortunate case where poor governance and the self-interest of directors have led to at least two publicly funded houses not being available to the Aboriginal and Torres Strait Islander community," Mr Beven said.
"If directors are more interested in what they personally can get from a corporation then they should not be directors."
A directions hearing will be held in the Federal Court in Canberra on May 1.
