A New South Wales self-managed superannuation fund (SMSF) accountant and former financial adviser has pleaded guilty to two charges of making false or misleading statements to obtain money from clients and fraudulent misappropriation of client funds, respectively.
Following an Australian Securities and Investments Commission (ASIC) investigation, Nicholas James Ellis admitted that between about 23 March 2009 and 18 July 2009, he:
- Sent 10 letters and one email to a number of his clients for the purpose of raising investment funds from them to purchase a hotel in Tura, NSW, through his company, Tura Pty Limited. The letters and email contained false and misleading statements in relation to the purchase of the hotel; and
- Fraudulently misappropriated over $500,000 of client funds received by Tura Pty Limited for his own purposes.
Ellis pleaded guilty to the charges today.
In February 2016, Ellis was charged with 23 criminal counts, including 12 counts of making false and misleading statements and misappropriating around $857,000 of investor funds.
In 2013, ASIC banned Ellis from providing financial services for six years following an investigation, which found he had engaged in dishonest conduct and misleading or deceptive conduct between 2 March 2009 and 29 June 2010.
The maximum term of imprisonment for obtaining money, etc. by false and misleading statements is five years while fraudulent misappropriation could carry a seven-year sentence.
The Commonwealth Director of Public Prosecutions in prosecuting the matter.