Loan scheme directors to reimburse clients

Three directors involved with a loans scheme to fund development of an invention have been found to have operated an unregistered managed investment scheme by theAustralian Securities and Investments Commission(ASIC), which has ordered the directors to pay back the $722,000 collected from investors.

Neil Richard Ashton, Peter Frederick McNally and Robert Walsh were involved with a loan scheme which raised money to develop a collapsible shipping container, developed by Foltainer International, of which Walsh is chairman.

Ashton and McNally are both directors of McNally Australia, a company that entered into loan agreements with 59 members of the Stafford-based Save Australia Buyers Club between February 2001 and January 2002.

McNally Australia told each of the 59 investors that their money would be used for the development, administration and marketing of the Foltainer invention and other Australian inventions. They were also told that they would receive interest on their money until such time that they requested its return.

ASIC found that Mcnally Australia and Walsh were actually operating an unregistered managed investment scheme and were providing investment advice without a securities licence in contravention of the Corporations Act.

McNally, Ashton and Walsh have acknowledged ASIC’s concerns and have undertaken to return the $722,000 collected from the 59 investors by October 1 this year.

“Companies [which] raise funds from the public must ensure their activities comply with the Corporations Act — and investors should obtain independent advice before making an investment decision,” ASIC director enforcement Allen Turton says.