The Supreme Court of Queensland has declared that an unregistered managed investments scheme has operated in breach of the Corporations Act.
Following an application by the Australian Securities and Investments Commission (ASIC), the court confirmed David Palmer and companies related to him (the Intertax Group) had operated the scheme in breach of the Act.
Justice Fryberg also ordered that Gerald Collins and Matthew Joiner of Jefferson Collins Joiner (Chartered Accountants) be appointed liquidators to wind up the members of the Intertax Group and the scheme.
The court accepted ASIC’s submission that several funds operated by the Intertax Group constituted one overall scheme.
A report prepared by Collins and Joiner for the court concluded that the scheme was insolvent and that investors in the scheme were owed approximately $14 million.
It also found grounds to suspect that Palmer and the Intertax Group had contravened the Corporations and ASIC Acts, and that the liabilities of the scheme had exceeded its assets by approximately $9.7 million.
The court also considered a proposal for the scheme’s winding up put forward by Palmer and supported by investors.
However, Justice Fryberg believed the proposal was a continuation of the unregistered managed investment schemes and “seriously doubted whether the proposal could be lawfully carried out”.
