Two insurance directors face criminal penalties after being convicted of failing to lodge financial statements and auditor's reports with ASIC for five consecutive years.

Phillip Bird and Daniel Holmes, both directors of Sheffield Insurance based in Perth's eastern suburbs, have each been fined $15,000 and ordered to pay court costs following their guilty pleas to two counts of aiding, abetting, counselling or procuring the company to commit reporting offences.

The convictions relate to Sheffield's failure to lodge profit and loss statements, balance sheets and auditors' reports with the regulator for every financial year between 2019 and 2023—a complete gap in the company's regulatory filing record.

As directors of an Australian Financial Services (AFS) licensee, Bird and Holmes were aware of the obligation to submit financial statements to ASIC within three months of each financial year-end, but failed to ensure the company complied.

Read more: Sheffield Insurance directors face charges over ASIC reporting lapses

The case marks an escalation in the regulator’s enforcement approach. ASIC Deputy Chair Sarah Court said the decision underscores that directors face individual criminal liability for their company's reporting failures.

"Financial reporting misconduct is now an enforcement priority for ASIC and we will not hesitate to take action for reporting failures,” said Court.

The prosecution was conducted by the Commonwealth Director of Public Prosecutions following an ASIC referral. While the maximum penalty for these offences carries up to five years imprisonment and fines of $126,000, summary proceedings in this case limited penalties to 12 months' imprisonment and/or fines up to $12,600 per charge.