Australian Securities & Investments Commission sues AVZ Minerals and directors Nigel Ferguson and Graeme Johnston over alleged Manono Project disclosure failures

The Australian Securities & Investments Commission has commenced Federal Court proceedings against AVZ Minerals Limited and two of its directors, alleging continuous disclosure breaches and misleading and deceptive conduct linked to market disclosures about the company’s Manono lithium project in the Democratic Republic of the Congo. ASIC alleges AVZ failed to announce an escalating legal dispute in the DRC concerning the acquisition of shares in the Manono Project, and that Managing Director Nigel Ferguson and Technical Director Graeme Johnston breached directors’ duties by failing to take reasonable steps to ensure compliance with continuous disclosure and by authorising or permitting ASX announcements that were false or misleading or omitted information. The proceedings cite, among other matters, a 4 May 2022 ASX announcement in which AVZ confirmed it retained legal title to a 75% interest in the project while describing related matters as “spurious and immaterial”, and referencing a DRC court decision and a claim by Dathomir Mining Resources SARL regarding the validity of share documentation. ASIC is seeking declarations of contravention against AVZ and, against Mr Ferguson and Mr Johnston, declarations of contravention and pecuniary penalties. AVZ entered a trading halt on 9 May 2022, was suspended on 11 May 2022 and was removed from official quotation on the ASX on 13 May 2024.