Embattled miner Mineral Resources and its managing director Chris Ellison have vowed to vigorously defend a class action over an offshore tax scandal that is now the subject of a probe by the corporate watchdog.
In an announcement to the market on Wednesday morning, the iron ore miner confirmed it had been served with a class action filed in the Victorian Supreme Court on Monday tied to allegations Ellison and four other executives had profited from an alleged offshore tax scheme that ran for a decade.
Mineral Resources managing director Chris Ellison.Credit: Trevor Collens
“MinRes intends to strongly defend the matter and will update the market in accordance with its continuous disclosure obligations,” the statement read.
According to the Australian Financial Review, the claim was filed on behalf of the self-managed superannuation fund of two shareholders who claim the company engaged in misleading conduct and failed to disclose material information which ultimately cost investors.
The company’s share price has been in freefall, plummeting more than 67 per cent in the past year amid on the back of falling lithium prices, debt woes and the uncertainty created by the governance scandal.
The Osborne Park-headquartered miner embarked on a governance overhaul in November after the AFR exposed the 2003 scheme, which involved using the entities to acquire mining equipment and parts to import and on-sell in Australia.
The board found two further payments were made by MinRes after the $6.6 billion diversified mining services company’s initial public offering in 2006 to extinguish the liability.
The revenue generated by the overseas entities benefiting was not disclosed to the Australian Taxation Office until 2021 when Ellison made a voluntary disclosure.
A board-ordered probe concluded Ellison used company resources for personal gain, from rent paid to entities in which he had an interest, staff directed to work on his personal property — including his boat — and relief afforded to entities tied to his daughter.
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