Ten-year advance see property spruiker banned
A Sydney-based director of a mortgage broker has been banned from engaging in credit activities for four years, by the Australian Securities and Investments Commission (ASIC).
Property adviser, Craig Eric Lynch, was found to have breached his duties as a director of Paramount Financial Services Pty Ltd (PFS) and Paramount Finance and Investment Services Pty Ltd (PFIS), in his treatment of personal loan accounts held with the two companies and in managing the taxation affairs of PFS.
ASIC reported that Lynch took a 10-year advance on his salary ($1.6 million) to payout a debt he personally owed to PFS, seven months before the business when into liquidation in November 2011.
"Between about July 2011 and September 2011, Mr Lynch recorded $705,200 received from a third party as a reduction to his personal loan account with PFIS," ASIC said.
"That money was supposed to be paid to PFIS as commission for property sales.
"In both instances, ASIC found that Mr Lynch had misused his position as a director to gain an advantage for himself or cause detriment to the company.
"ASIC also found that Mr Lynch was not a fit and proper person to engage in credit activities. ASIC found that Mr Lynch:
- engaged in conduct that resulted in PFS submitting to a credit provider a loan application containing misleading income details of the applicant and a falsified supporting payslip;
- was aware of a practice at PFS and PFIS that clients were instructed to sign blank application forms; and
- had breached his duties as a director of PFS and PFIS in relation to the dealings on his personal loan accounts with those companies."
AUTHOR
Nicholas O'Donoghue
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