Since February 2001 when the Australian Securities and Investments Commission (ASIC) announced it would conduct a review of solicitor’s mortgages schemes, ASIC has acted on nearly 20 separate occasions in relation to the schemes. Here are some highlights.
Schemes wound up by ASIC based on court orders:
– Triscott & Associates in Queensland and ASIC also restrained Paul Triscott from leaving Australia and removed Triscott Investments Ltd as the responsible entity of the Australian Managed Mortgage Investments Fund.
– Knightsbridge Finance Mortgage Scheme and related unregistered schemes, however, the decision is on appeal to the Full Court of Western Australia.
– Five solicitor’s mortgages schemes; three in Queensland (McCarthy Durie Ryan Neil, PCCR Nominees Pty Ltd and Sean Neilson-Brown) and two in Tasmania (E.R. Henry Wherrett and Benjamin, and Piggott Wood and Baker). These schemes involved loans to the value of $35,617,470.
Imposed additional conditions:
– As the result of hearings into the dealers licences held by Mortgages North (Qld) and Lansdowne Management Limited, ASIC imposed additional conditions on Lansdowne Management Ltd, including that it engages a professional compliance consultant to report to ASIC on its compliance.
– ASIC imposed special reporting conditions on the licences of AMT Mortgages Ltd and Eclipse Prudent Mortgage Corporation Ltd.
– ASIC required corrective disclosures to be made in four prospectuses, lodged by Banksia Mortgages, Australian Securities Limited, Shore Securities and M.M. and R. Mortgage Nominees Pty Ltd.
– Special licence conditions were imposed on Farm Mortgages Limited and Larkins McCarthy Securities Limited after ASIC surveillance.
– ASIC is commencing a number of investigations into suspected contraventions of the Corporations Law, which remain confidential at this stage.
Enforceable undertakings:
– Received from Garrisons Pty Ltd on June 28, 2001, in relation to clients that it had introduced to non-performing solicitor’s mortgages schemes in Tasmania, estimated to return in the range of $2.5 to $3 million to investors.
– Provided by scheme operators Davoren, Coman and Stokes, in relation to disclosure to investors, and reports to ASIC on the sale and distribution of mortgage properties.
Investigations leading to prosecutions:
– Andrew Kenneth Nuske, a former director of Mancross Pty Ltd, which operated a mortgage broking business called South East Queensland Home Loan Centre, received a seven year jail sentence in July 2001 after pleading guilty to 28 charges of obtaining $647,000 by misappropriation, false pretences and forgery.
– In July 2001, Stephen Mark O’Neill, a mortgage originator with the Bailey O’Neill group of Melbourne, received a five year jail sentence after pleading guilty to charges of theft, using false documents, and improperly using his position as a director to gain an advantage for himself.
– In August 2001, Thomas Peter Baron is charged with 38 counts of fraudulent conduct in connection with the failed solicitor’s mortgages fund operated by the Hobart law firm Lewis Driscoll & Bull. The case is currently before the Tasmanian Court of Petty Sessions.
Source: ASIC
