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Feb 26 2007
James Hardie is facing another suit launched by the Australian Security and Investments Commission (ASIC). The building materials company has been accused of misleading investors regarding the expense of compensating its asbestos products' victims. James Hardie had agreed to pay 4 billion Australian dollars to the Asbestos Injuries Compensation Fund (AICF) over the next 40 years at the end of compromises for months with unions. The suit was filed in the New South Wales state Supreme Court last week. According to ASIC, James Hardie and its executives completely failed to act with mandatory attention and earnestness as they convinced the investors in 2001 that the asbestos compensation plan of the company had been fully funded when it was $1 billion short. 10 James Hardie officials - including Meredith Hellicar (Chairwoman), Peter Macdonald (former Chief Executive) and Peter Shafron(former Chief Financial Officer) - have been named in the claim. ASIC Chairman Jeffrey Lucy told that James Hardie should be complimented for its new compensation plan however, its executives should not escape punishment. While talking to a correspondent of the Australian Stock Exchange, Lucy said though the new compensation agreements are very much welcomed, they do not diminish the need to hold those have been identified to be responsible for the breaches. To watch the legal proceedings, James Hardie has organized a special committee of company directors not named in the ASIC case. They said they have provisions to provide the directors and executives involved in the ASIC suit with legal compensations. They added that the company was not in a position to comment further at that time. The accused can be possibly given penalties of around $157,000 for the violation of corporations law.
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