Illegal scheme runs out of gas
An illegal fuel scheme has received wind-up orders from the Federal Court after an investigation by the securities regulator found Fuelbanc Australia to be an unregistered managed investment scheme.
The court accepted the Australian Securities Investments Commission’s (ASIC) findings that the operators of the Fuelbanc scheme, including former director Stephen McDougall, Paycards Global, Paycard Investments and PC Property Group, had attempted to circumvent registration and disclosure requirements under the Corporations Act by claiming to be a body corporate and not a managed investment scheme.
According to ASIC, at least 510 investors agreed to join the Fuelbanc scheme, giving money in exchange for payments of weekly instalments onto a debit card that could be used to buy fuel and other goods at petrol stations throughout Australia. A report filed with the court last year found investors had paid $907,576 in cash into the scheme and, based on the available information, were still owed $1,499,913.
The court has ordered that the scheme and incorporated defendants be wound up, and appointed George Georges and Adrian Brown as joint liquidators of the scheme.
McDougall has been permanently restrained from operating or promoting the Fuelbanc scheme and from dealing in financial products without holding an Australian Financial Services Licence. He was also ordered to pay ASIC’s court costs.
McDougall and BTS Management had previously promoted and operated a similar scheme in late 2005 called FuelTank. The scheme offered consumers’ savings of between 50 and 80 per cent on fuel costs. Members would pay an upfront fee and be issued with a store value card that could be used to purchase fuel.
The court had similarly declared that the FuelTank scheme be wound up, and determined the operators had run a managed investment scheme that required registration and had carried out a financial services business without proper licensing.
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