Despite criminal charges and legal grounds, court keeps freezing order in place
A Federal Court judge dismissed a bond operations manager's application to discharge a freezing order, while also varying the amount frozen downward to reflect a revised claim figure.
In Income Asset Management Group Limited v Henry, decided on 25 March 2026, Federal Court Justice Moore dismissed Kimberley Henry's application to discharge the freezing order, finding that none of the seven grounds Henry raised, whether taken together or independently, supported an order for discharge. The court did, however, amend the freezing order to reduce the frozen amount.
Income Asset Management Group Limited (IAM), an Australian fixed income house managing more than $2 billion in funds across over 2,000 wholesale client accounts, commenced proceedings against Henry on 19 September 2025.
Henry held the position of operations manager – bonds at IAM and served as an authorised signatory for IAM's sub-custodian, Apex Group, granting him authority to approve the movement of funds across IAM's bank accounts.
IAM alleged that between July 2024 and May 2025, Henry submitted falsified payment instruction forms to Apex directing it to transfer funds from an Apex-controlled settlement and trust account held with JP Morgan to his personal NAB account. He listed different IAM client account details on each form but directed all payments to the same destination account number: his own. According to IAM's evidence, 64 transfers totalling approximately $1.5 million moved from an Apex account to Henry's NAB account over that period. Bank statements produced by NAB under subpoena separately confirmed more than $1.3 million in transfers from Apex Fund Services to the NAB account, with Henry then withdrawing much of it in cash or transferring it to accounts in his name. Henry also faced criminal charges in Queensland related to the same alleged payments.
On 19 September 2025, Justice Perram heard the application ex parte and granted the freezing order. Henry appeared in person, his former lawyers having ceased to act. He also submitted that he had exhausted his permitted legal fee allowance on multiple occasions, with each request for an increase absorbing a substantial portion of the additional allowance in the costs of seeking it. Henry raised seven grounds for discharge: no real risk of dissipation, disproportionality, oppressive operation, inadequacy of IAM's undertaking as to damages, material non-disclosures, balance of convenience, and material change in circumstances.
Justice Moore found none of the seven grounds warranted a discharge of the freezing order. On dissipation risk, the court noted that Henry had not explained the transfers into his NAB account or where the money had gone, and that the evidence of high risk was not dispelled by Henry's reluctance to address the matter, which the court acknowledged was understandable given his criminal charges.
On the undertaking as to damages, Henry pointed to IAM's ASX announcement of 22 December 2025 disclosing a $2 million unsecured debt raising at 15 percent per annum, maturing 1 July 2027. Justice Moore found the announcement did not raise sufficient doubt over IAM's financial position, noting that IAM's board had stated it held sufficient cash resources to continue operating efficiently even without the additional funds.
Prior to the hearing, IAM conceded that the alleged misappropriated sum had reduced from $1,528,621.71 to $1,375,509.60. Justice Moore accepted Henry's submission that "a freezing order founded on provisional figures must be revisited when those figures materially change," and amended the freezing order to reflect the reduced amount.
Justice Moore ordered Henry to pay IAM's costs associated with the discharge application.
The balance of the interlocutory application, which also sought production of any insurance policy that may respond to the claims in the proceeding, has not yet been determined.
