Reference no: EM133458726

In addition to his own small company, Johnny sits on the board of Randall Corporation, a large multi-national public company, as a non-executive director. Johnny has a gambling addiction and is in significant personal debt. A financial trader tells Johnny that he can make a lot of money if he uses his position as director to gain access to the Randall Corporation's cheques, forge a loan from Randall Corporation to his small company, and then use this money to buy shares in Randall Corporation. Johnny follows this advice, and within one week makes enough profit to discharge all his personal debts. Johnny then sells the shares and pays back the total amount loaned from Randall Corporation. ASIC discovers the fraud and takes action against Johnny for contravening his duties as company director. Johnny argues that since the loan was paid back in entirety, Randall Corporation has not suffered any detriment.

Explain, with reference to the Corporations Act 2001 (Cth) and case law, whether Johnny has acted in accordance with his duties as a director.