A former strategy manager at suspended stockbroking firm BBY has been charged with aiding and abetting dishonest conduct including the alleged transfers of $8.7 million in client funds into other accounts.
ASIC has charged Yat Nam (April) Yuen, of Sydney, New South Wales, who held various roles at BBY including manager of strategy, with two offences contrary to sections 1041G(1) and 1311 of the Corporations Act 2001 and section 11.2 of the Criminal Code.
On about 13 June 2014, Yuen allegedly instructed St George Bank, a division of Westpac Banking Corporation, to transfer $6.8 million of client money out of BBY’s Futures client segregated account (a client money account) and into other accounts.
According to ASIC, this was allegedly intended to fund a margin payment to ASX Clear Pty Ltd, in breach of BBY’s obligation to hold that client money on trust.
In addition, the corporate regulator alleges that Yuen told St George Bank on 31 March 2015 to transfer $350,000 of client money out of BBY’s Futures client segregated account and $1.6 million of client money out of BBY’s Saxo Buffer account, another client money account, into BBY’s Operating Account held by NAB.
“ASIC alleges these instructions had the intention of funding a corporate payment, in breach of BBY’s obligation to hold those client monies on trust,” the statement continued.
Each offence has a maximum penalty of 10 years’ imprisonment.
Yuen appeared in Downing Centre Local Court in Sydney today (28 November), with the matter being adjourned for further mention on 6 February 2024. The matter is being prosecuted by the Commonwealth Director of Public Prosecutions.
On 10 October 2023, ASIC also charged the former chief executive of BBY, Arunesh Narain Mahara, for allegedly aiding, abetting, counselling or procuring offences by another former BBY employee, who, by deception, dishonestly obtained a financial advantage for BBY from St George Bank.
The former head of operations at BBY, Fiona Mae Bilton, was sentenced in June 2023 after pleading guilty to three counts of dishonestly obtaining a financial advantage.
The court sentenced her to imprisonment of 20 months, which was suspended for three years on the first charge. It imposed a community correction order for three and a half years on the second and third charges, including 380 hours of unpaid community work.
BBY was a former stockbroker and financial services business that was placed into voluntary administration on 17 May 2015 and in liquidation on 22 June 2015.
The collapse was the largest Australian stockbroking failure since the Global Financial Crisis with 6,000 former clients claiming $62 million against client assets. BBY held assets in, among others, client segregated accounts, futures contracts and options, exchange-traded options, and products offered via Saxo Capital Markets.
Its Australian financial services licence (AFSL) was suspended by ASIC in May 2015 and remained in place until the licence was cancelled in June 2021.
ASIC’s investigation is ongoing.
