Australian Securities and Investments Commission v Keystone Asset Management Ltd (receivers and managers appointed) (in liquidation) (No 4)

This decision arose inside a larger Federal Court proceeding brought by ASIC against Keystone Asset Management Ltd. By the time this subpoena dispute was heard, Keystone was already subject to court-appointed receivers and managers, had gone into voluntary administration, and had then entered liquidation. That setting matters because the Court was supervising appointees carrying out functions conferred by earlier orders, not simply deciding a standard commercial fight between two private parties.

The receivers had been appointed over Keystone's property for broad investigative and recovery purposes. Their role included identifying, collecting and securing property, ascertaining investor funds received by Keystone, identifying dealings with those funds, identifying property acquired directly or indirectly with investor funds, and recovering investor funds. Later, in a separate interlocutory application, the appointees sought judicial directions about realising certain listed equities held by Keystone as responsible entity of the Shield Master Fund and making an interim distribution of the proceeds.

That interim distribution application drew in a dispute about whether assets connected with the Shield Master Fund and the Chiodo Diversified Property Fund had been mixed. Falcon's liquidators, who had lodged a substantial proof of debt in Keystone's liquidation, challenged the receivers' confidence that there had been no material co-mingling or intermingling between those funds. Shortly after that challenge was raised in correspondence, the receivers sought subpoenas to three banks.

The subpoenas went to Westpac, ANZ and CBA. They sought bank statements for accounts held by Paul Chiodo, Chiodo Corporation Pty Ltd, certain members of Mr Chiodo's family, Donchiod Group, Pure Development and Project Management Pty Ltd, and some additional related accounts. Mr Chiodo objected and applied to have the subpoenas partially set aside.

The receivers relied on two separate justifications for the subpoenas, and the distinction between them was central to the result.

The first justification was tied to the interim distribution application. The receivers said the bank statements might be relevant to a live issue in that application, namely whether there had been intermingling of CDPF assets with SMF assets. They pointed to correspondence from Falcon's solicitors, which said the receivers' earlier statements about there being no material co-mingling were not enough to satisfy Falcon, particularly if those statements were based on bank narrations rather than underlying traces or did not fully address source of funds.

The second justification was different. The receivers said the statements would assist them in carrying out their court-appointed functions. They considered the listed accounts may have received money from the CDPF, a fund of which Keystone was trustee. On that basis, the statements could help identify and secure Keystone property, including possible CDPF funds that may have been misapplied by payment into those accounts.

Mr Chiodo argued that the subpoenas did not satisfy the usual subpoena principles. He relied on authority stating that the party issuing a subpoena bears the onus of showing a legitimate forensic purpose in relation to issues in the proceeding. He said the statements were not relevant to the interim distribution issue and that there was no authority for using subpoenas simply to help receivers perform their role.

The legal issue was whether there was a proper basis for the subpoenas. The judgment accepts that, in ordinary inter partes litigation, the issuing party must show a legitimate forensic purpose connected to issues in the proceeding. Mr Chiodo relied on that line of authority and said these subpoenas failed the test.

Moshinsky J accepted that there was a real issue in the interim distribution application about whether CDPF assets had been intermingled with SMF assets. But the judge then asked a narrower and more practical question: would these particular bank statements shed light on that issue? On the first justification, the answer was no.

The reason was one of logic. The intermingling issue concerned payments going from the CDPF to the SMF. But the subpoenaed accounts were not SMF accounts. They were accounts of Mr Chiodo, Chiodo Corporation, family members and related entities. For those statements to help prove intermingling between CDPF and SMF assets, there would need to be some suggestion that money moved from the CDPF into those accounts and then on to the SMF. The judgment says there was no such suggestion. The Court also noted that the affidavit relied on by the receivers did not explain how the bank statements would or could be relevant to determining whether CDPF assets had been intermingled with SMF assets. So the first justification failed.

The second justification succeeded because it was directed to a different purpose. The Court held that where a receiver has been appointed by the Court for the purpose of identifying and securing a company's property, a subpoena may be issued to obtain documents that assist the receiver to perform those functions. The judge said that power is incidental to the Court's power to appoint the receiver in the first place. Otherwise, a receiver may be unable to access relevant documents held by third parties and may struggle to carry out the role for which the Court appointed them.

The Court distinguished the authorities relied on by Mr Chiodo on the basis that they concerned a different context, namely ordinary litigation between parties where pleadings define the issues. The judge did not treat those authorities as preventing the use of subpoenas in an appropriate case to support the work of a court-appointed receiver.

On the evidence, the receivers considered the listed accounts may have received CDPF funds directly or indirectly. The judgment says the material referred to in the supporting affidavit gave them a sound basis for that view. Because the bank statements may disclose the misapplication of CDPF funds, there was a proper basis for the subpoenas.

The Court dismissed Mr Chiodo's interlocutory application to partially set aside the subpoenas. That means the subpoenas stood, and the banks' production of statements was not undone by the challenge.

The important nuance is that the Court did not accept every reason advanced in support of the subpoenas. It rejected the first rationale, which was that the statements would help determine whether CDPF assets had been intermingled with SMF assets in the interim distribution dispute. The Court found that rationale did not work because the accounts targeted by the subpoenas were not SMF accounts and there was no suggested onward transfer from those accounts to the SMF.

But the Court accepted the second rationale. It held that, in the circumstances of this case, subpoenas could properly be used to obtain documents that would assist court-appointed receivers to identify and secure Keystone property, including possible CDPF funds. The evidence established a sound basis for the receivers to think the listed accounts may have received CDPF money directly or indirectly.

The Court also amended the earlier orders made on 27 August 2024. The amendment changed the definition of Keystone's 'Relevant Capacities' so it expressly included Keystone in its capacity as trustee for the CDPF, and inserted a definition of CDPF. The judge considered that, even before the amendment, the receivers had been appointed in relation to the CDPF because of the definition of 'Property' in the original orders and because Keystone was trustee of the CDPF. The amendment was made for clarity rather than to create a wholly new appointment.

Costs were reserved. The judge said that if either party wanted a different costs order at that stage, the issue could be raised before the next case management hearing.

Most businesses will never be involved in a Federal Court receivership of this kind. But the decision still offers practical guidance for any business that handles money for others, operates through multiple entities, or uses related-party accounts.

First, the case shows that personal, family and related-entity accounts can come under scrutiny where there is a sound basis to think they may have received trust or fund money. The Court did not treat those accounts as off limits simply because they were not the company's own operating accounts.

Secondly, the case shows that the Court will test the stated purpose of a subpoena carefully. A broad tracing explanation is not enough by itself. The first justification failed because the documents sought did not logically connect to the issue said to be in dispute. Businesses resisting subpoenas should understand that a challenge may succeed if the issuing party cannot explain that connection. But where court-appointed receivers can show the documents may help them identify and secure property they have been appointed to recover, the Court may allow the subpoena even if the usual pleaded-issue model does not fit neatly.

Thirdly, capacity matters. Keystone acted in different capacities, including as responsible entity and trustee of different funds. The Court amended the earlier orders so the CDPF trustee capacity was expressly named. For businesses, that is a reminder that contracts, account names, ledgers and internal approvals should clearly identify the legal capacity in which money is held and paid. If a company acts in several capacities, blurred paperwork can complicate tracing, distributions and recoveries.

Finally, record-keeping is not just an accounting issue. It can shape whether a court-appointed appointee can trace funds quickly, whether a subpoena is issued, and how expensive a dispute becomes. If money moved for legitimate reasons, clear records are often the best protection.

The key procedural dates recorded in the judgment are these. The receivers were appointed on 27 August 2024. They were then appointed as voluntary administrators on 5 September 2024. Keystone entered liquidation on 2 December 2024. The interim distribution application was filed on 7 November 2025 and later amended on 8 December 2025. Falcon's solicitors sent the key objection letter on 9 December 2025. The receivers requested leave to issue the subpoenas on 11 December 2025. Mr Chiodo's objection letter was dated 23 January 2026, and his interlocutory application to partially set aside the subpoenas was dated 11 February 2026. The subpoena dispute was heard on 12 February 2026 and decided on 16 February 2026.

This is a procedural judgment in an ongoing broader matter. It should be read as authority on the Court's approach to these subpoenas and the scope of the receivers' functions in this context, not as a final determination of all underlying claims concerning the funds or related parties.

This page is based on the Federal Court judgment in Australian Securities and Investments Commission v Keystone Asset Management Ltd (receivers and managers appointed) (in liquidation) (No 4) [2026] FCA 89, delivered by Moshinsky J on 16 February 2026. The judgment records the orders made, the parties' competing arguments, the Court's reasoning on each justification for the subpoenas, and the amendment to the earlier August 2024 orders.

Because the judgment focuses on the subpoena application, it does not provide a complete narrative of all underlying fund transactions or all evidence before the Court in the broader proceeding. It is general information only and not legal advice.