Supreme Court orders return of offshore funds
The New South Wales Supreme Court has ordered the return to Australia of more than $1 million of investor money held in offshore banks and securities trading accounts after an application by the Australian Securities and Investments Commission (ASIC).
The funds belong to investors in the Secured Bond Master Fund in the United States and Hong Kong. The accounts were frozen by an earlier court order.
ASIC believes that the fund had the characteristics of an illegal managed investment scheme and that some funds were being used to pay off existing investors, who believed they were being paid interest returns on existing payments. ASIC also believes that the funds were used to pay the defendants or the trusts or companies associated with them.
ASIC alleged that five individuals, David John Hobbs, Min Hua Li, David John Collard, Bi Hong Dong, and Li Men Zeng, contravened the Corporations Act by operating the fund scheme. It also alleged that Li, Zeng, and Collard were running a financial services business without the required Australian Financial Services Licence.
According to ASIC, more than 40 investors invested approximately $4 million in the fund. The fund advised investors of potential returns of 10 per cent per month, which may have been false or misleading.
The funds will be held by the Supreme Court after being returned to Australia.
Investigations into the matter are continuing.
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