One.Tel trio's assets in limbo

Maxine and Jodee Rich leave court Wednesday after giving undertakings about their assets

By CNN's Geoff Hiscock, Asia business editor

SYDNEY, Australia -- Australia's corporate regulator ASIC won court-enforceable undertakings Wednesday restraining asset sales by the co-founders of failed Australian telco One.Tel.

The Australian Securities and Investments Commission said the undertakings given in the New South Wales Supreme Court covered the assets of former co-chief executives Jodee Rich and Brad Keeling, and former chief operating officer Mark Silbermann.

One.Tel, whose shareholders include Australia's two biggest media companies, Publishing & Broadcasting Ltd and News Ltd, collapsed into insolvency on May 30 with debts of more than $300 million.

Rich moved assets into his wife's name on May 31 and resigned as a director of several companies.

But on Wednesday Rich's wife Maxine gave an undertaking to the court freezing those assets.

However, ASIC agreed to drop action freezing the assets of Rich's sister Nicolet Long.

No disposal of property allowed

ASIC chairman David Knott said the undertakings given by Rich, Keeling and Silbermann prohibit them from disposing of any property. They apply until September 30 this year.

The trio are also restrained from leaving Australia without giving ASIC seven days' notice.

One.Tel's collapse is now the subject of an investigation by ASIC, which seized documents after raids on directors' homes and the One.Tel office on June 1.

However, Knott stressed that the proceedings on Wednesday did not constitute "any finding of wrongdoing against any of the defendants".

Outside the court, Rich made his first public comment since One.Tel's collapse at the end of May. He said he was distressed about what had happened, and said One.Tel had gone from a great business to a great tragedy.

Company being broken up for sale

Joint administrator Steve Sherman of corporate recovery firm Ferrier Hodgson said last week that One.Tel would be broken up and sold to help repay debt.

Sherman laid off virtually all of One.Tel's 1700 staff in Australia Friday as part of a "controlled wind-down". He is seeking to raise enough funds from his deals with Telstra, Optus and other parties to be able to pay staff entitlements in full, estimated to be about $10 million.

One.Tel's spectacular collapse embarrassed and angered its two high-profile backers, PBL chairman James Packer and News Ltd chairman Lachlan Murdoch, who were both on the board of One.Tel.

They said they had been "profoundly misled" about the true state of One.Tel's finances. Between them PBL and News own 41 percent of One.Tel and had committed about $460 million to the telco's developments.

One.Tel founders Rich and Keeling were removed as joint chief executives and board members on May 17 by PBL and News.