Former adviser ordered to repay client $190k
A Victorian financial adviser has been ordered to repay $190,000 to a client he deceived, after pleading guilding to falsely representing an investment made on her behalf.
The County Court of Victoria heard that Geoffrey Curran, 64, approached a long-term client, Helen Brooks, in 2002, to enquire if she was interested in making a new $250,000 investment.
Curran told Brooks that her funds would be invested in mortgages which were guaranteed by AAA institutions with an expectation of a 10 per cent yield.
However, he did not reveal the capital was to be used to fund the construction of an apartment block in Ivanhoe, and there was no AAA bank guarantee on the investment.
Court papers revealed that Brooks transferred the funds to Curran on 18 July 2002, and almost a year later the property venture collapsed and Brooks' funds were effectively lost.
The court heard that Curran did not inform Brooks that the money had been lost instead he continued to make monthly "interest" payments of $2100, as had been agreed, until 2006.
In February 2006, Brooks contacted Curran to seek advice about obtaining a loan against her $250,000, he responded that the original funds had been "incorrectly distributed without authority" by a solicitor.
In 2008, Brooks commenced civil proceedings against Curran, Monaghan McLean and Co (MMC) — an accounting firm Curran was employed by — and a legal firm, with MMC and the law firm reaching a settlement with Brooks in July 2010, where the two parties paid Brooks $30,000 each.
In March 2012, Brooks notified local police in South Australia, which led to Curran being interviewed at Frankston Police Station on 5 September 2013, where he admitted to the alleged actions, but disputed they constituted an offence.
Curran was convicted of obtaining financial advantage by deception contrary to s82(1) of the Crimes Act 1958 and sentenced to six month imprisonment, wholly suspended for 12 months, and was ordered to pay Brooks compensation of $190,000.
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