Former credit broker permanently banned after fraud convictions – June 9, 2023
The former Sydney credit broker Trevor William King has been convicted of fraud offences, and therefore permanently banned from taking part in any credit activities and from providing financial services.
Between July 2013 and May 2016, King produced 74 false documents (57 payslips, nine PAYG payment summaries and eight real estate documents) to be used to support loan applications for clients of JT King Finance Pty Ltd (JT King) and Australia Enterprises Pty Ltd (companies he part-owned).
By these actions, King and others obtained commissions from loans ranged from A$643.50 to A$6,795.36 ($433.57 – $4,578.49) in upfront commissions and A$99.67 to A$2,470.69 ($67.16 – 1,664.73) in trail commissions, with the total amount of commissions being A$81,057.35 ($54,608.86)
He was convicted and sentenced in February to a 14-month intensive corrections order (21-021MR).
Former Head of Operations sentenced – June 9, 2023
Fiona Mae Bilton, former Head of Operations of the collapsed stockbroking firm BBY Limited (BBY), has been sentenced after pleading guilty to three charges of dishonestly obtaining a financial advantage contrary to s82(1) Crimes Act 1958 (Vic).
Between June 2013 and May 2015, Bilton deceived St George Bank concerning the amount of BBY’s unsettled equities trades, where she claimed additional funding from an overdraft facility for BBY 115 times.
Bilton, with alleged involvement of colleagues, also sent false summaries of unsettled customer contracts to the bank to support the requests for additional funding from its overdraft facility.
Bilton has received a sentence of imprisonment of 20 months, which was suspended for three years on the first charge. A correction order was imposed for 3.5 years on the second and third charges, plus 380 hours of community work.
She will also be disqualified from managing corporations for five years, including being unable to be involved in the business of a market participant in relation to securities and futures markets.
An investigation into BBY is still going on.
Director banned for eight years after misleading customers – June 9, 2023
Shaun Fox, the director of Foxi Capital AU Pty Ltd and authorised representative of Responsible Entity Services Ltd, has been banned for eight years from providing or being involved in financial services after making false and misleading statements, plus being engaged in misleading and deceptive conduct regarding financial products.
The ban was based on:
- Fox’s lack of formal qualifications and industry experience;
- misrepresentations made out to potential investors;
- a track record of incomplete and unsuccessful investment offerings, including not providing investors with share certificates;
- the misuse of Plazrok Investor Trust funds, and
- misrepresentations made out to ASIC.
Director restrained for life for operating without license – June 8, 2023
The unlicensed financial adviser Monica Kaur has been permanently restrained from carrying on a financial business after operating improperly, and her unregistered managed investment scheme MKS Property Investments/Developments Pty Ltd will be wound up.
Between March 2017 and December 2020, around 300 investors were encouraged by Kaur and MKS Property to establish self-managed superannuation funds, plus advised to invest in property and developments set up by MKS Property.
Besides being restrained from carrying on a financial services business, Kaur has also been disqualified from managing corporations for life, and her husband has been disqualified for 15 years over his involvement.
“The venture into which Ms Kaur directed investor funds was risky and speculative, as is shown by the likelihood that most if not all of the funds of many of the investors have been lost.”
Justice Jackson
Man charged with dishonest conduct and dealing with proceeds of crime – June 7, 2023
Ashley Vincent Arandez has been charged with three counts of dishonest conduct, in violation of section 1041G of the Corporations Act, and eight counts of dealing with proceeds of crime – violating section 400.4 of the Criminal Code Act 1995.
He is also facing charges over one count of carrying on a financial services business without holding an Australian Financial Services licence, which is a violation of section 911A of the Corporations Act.
Arandez allegedly promoted and ran a financial firm between September 2017 to April 2021 where clients were encouraged to roll over their superannuation into new self-managed superannuation funds and invest in business ventures – ventures Arandez controlled.
Arendez is facing heavy punishment. Failing to hold an AFSL carries a maximum penalty of five years in prison; engaging in dishonest conduct in relation to a financial product or financial service; whilst carrying on a financial services business carrie a sentence of 10 years; and intentionally dealing with the proceeds of crime a maximum of 20 years.
The Federal Court ordered ASIC in 2022 to freeze Arandez and the five related entities assets. The orders were later updated with a travel ban in February 2023.
Financial adviser banned for five years – June 6, 2023
The Brisbane financial adviser Stephen Garry Vick has been banned from providing or being involved in any financial services business, or controlling an entity that carries on a financial services business – for five years.
The actions come after Vick was found to have:
- not acted in the best interests of clients, giving defective statements of advice that contained numerous misleading statements and omissions;
- had a business structure that created conflicts of interest, and prioritized his own interests over the clients’; and
- accepted conflicted remuneration.
The ban started on September 5, 2022. However Vick has applied to seek a review of ASIC’s decision, including stay and confidentiality orders. These orders were denied on May 17, 2023, yet no hearing date has been set for the substantive review of ASIC’s decision.
ASIC cancels further 29 SMSF auditors – June 6, 2023
A further 29 registrations of auditors of self-managed superannuation funds (SMSFs) who failed to lodge their annual statements have been canceled.
To date, 374 SMSF auditors were cancelled in January 2023 (23-012MR), and 10 in May 2022 (22-121MR) as part of ASIC’s current compliance program.
In total, over 1,400 SMSF auditors have been told they have outstanding annual statements.
Under s128G of the Superannuation Industry (Supervision) Act 1993, SMSF auditors must annually lodge a statement with ASIC within 30 days of the anniversary of their registration.
“ASIC expects SMSF auditors to comply with their regulatory obligations given the important role they play in promoting confidence in the SMSF sector.”
ASIC Commissioner Danielle Press
Lantern RE Ltd loses AFS licence – June 5, 2023
The Australian financial services (AFS) licence of Lantern RE Ltd (Lantern) has been suspended until May 29, 2024.
The suspension comes after failings to lodge financial statements and audit reports for the financial years 2019-2022. Lantern also failed to lodge compliance plan audit reports for the registered management investment scheme Fracprop for financial years 2020-2022.
The AFS licence provides authorisation to deal in interests in managed investment schemes and give general financial product advice to wholesale and retail clients. Further actions may be taken if Lantern fails to rectify the breaches.
Two Queensland property investment directors found not fit for financial services – June 6, 2023
David Bugeja and Brian Washbournel, the directors of Bugwash Property Pty Ltd, have been banned from providing or being involved in any financial services for six years.
Both directors were found dealing in financial products and in general insurance products on another’s behalf without the necessary authorisations or licence.
They also failed to provide adequate disclosure to investors and act in their best interest.
Director duties charge proved and dismissed – June 5, 2023
Former company director Pardeep Sehgal has pleaded guilty to charges over breaching his director duties – and violating section 184(2) of the Corporations Act.
In April 2018, Sehgal directed two payments totalling A$55,099.33 ($37,144.20) to his partner and Shorya Pty Ltd, where Sehgal also was the sole director – instead of going to the Sehgal Catering Services Pty Ltd, which was in liquidation and had debts of A$276,752 (S186,562.42) to creditors, and A$259,828.02 (S175,153.73) to the Australian Taxation Office.
The charges have been proven but dismissed after taking Sehgal’s good character, lack of antecedents and extenuating circumstances into account.
Gold Coast property developer charged with defrauding investors – June 5, 2023
The property developer Michael David Steele has been charged with seven counts of fraud – in breach of s408C(1)(a)(i) of the Queensland Criminal Code.
It is alleged that, between May 2016 and February 2017, 14 investors were misled by Steele into withdrawing money from their employer superannuation funds and savings accounts, and then guided to invest in a property development at Biggera Waters, Queensland. Allegedly, Steele withdrew more than A$1.3m ($0.87m) of the invested funds and used it for other purposes than property development.
The penalty for the alleged charges ranges between 12 and 20 years imprisonment.