BusinessDay revealed in April that Mr Ballintine had last year transferred 3 million shares to a controversial United States lender in order to get a $400,000 advance during the same time he had called a "blackout period" to prevent NewSat directors and staff trading their stock.

NewSat's board was not aware at the time of  Mr Ballintine's transfer of shares Equity First Holdings as loan collateral. When it found out much later, the board sought advice from HWL Ebsworth Lawyers.

The advice, provided in February, stated: "We are of the opinion that Ballintine should have notified ASIC (by NewSat lodging an Appendix 3Y) in relation to the transfer of the Ballintine shares ... under section 205G of the Corporations Act. This is on the basis that Ballintine no longer has a relevant interest in the secured shares ..."

"We note that section 205G of the Corporations Act imposes the obligation on the director, not the entity, to make the notification."

NewSat, which aspired to put Australia's first privately owned and operated satellite into orbit,  went into liquidation in April after relations with its US and French government lenders soured amid governance and capital-raising concerns. Its shareholders are likely to receive nothing.

ASIC continues to investigate transactions between NewSat and Gold Coast Cresta Motor Yacht company, owned by Mr Ballintine and several other former NewSat directors, investors and consultants.
BusinessDay has also learnt  that Mr Ballintine issued legal threats to NewSat during 2014 after the company announced to the Australian Securities Exchange a cost- reduction strategy that included executives having their wages and benefits reduced.

The legal threat from an "employee" was noted in the company's June 2014 accounts. 
BusinessDay last month revealed how NewSat's main lender, the US government's EXIM Bank, and other financiers, twice sought the removal of Mr Ballintine and chairman Richard Green in the months leading up to NewSat's collapse after a forensic accountant audit discovered "potential unlawful conduct" and "serious management failings".

Mr Ballintine has defended his use of his NewSat shares to secure a loan from Equity First Holdings during a trading blackout, claiming his transfer was different from "trading".

HWL Ebsworth advised that Mr Ballintine had not breached the NewSat share trade policy in place at the time. However, the company introduced a new share trade policy late last year that  would have required Mr Ballintine to seek approval from the chairman to transfer shares to secure a loan.

Weeks after Mr Ballintine called the trading blackout in April last year, NewSat issued a revived earnings projection, which caused its share price to plummet.

In an email to fellow directors on April 17 last year to explain his decision to ban trading, Mr Ballintine wrote: "I am very concerned that anyone trading may be caught up in the insider-trading legislation".

NewSat advised the ASX of the change in Mr Ballintine's "notifiable interest" only shortly before its April collapse.