Another property investment scheme collapses
South Australian-based mortgage business John West & Associates has been placed in provisional liquidation, with debts totalling around $9.5 million.
The Supreme Court of Adelaide’s decision to appoint Austin Taylor of Meertens Chartered Accountants as professional liquidator of John West follows an action commenced by the corporate regulator in March this year.
Although this is the latest in a string of high-profile, property-related managed investment scheme failures, including Bridgecorp, Westpoint, Fincorp and Australian Capital Reserve (ACR), Taylor said it is the first of such in South Australia
The Australian Securities and Investments Commission (ASIC) alleges that Jonathan West of Athelstone, South Australia and the company operated an illegal management investment scheme since May 21, 2003, borrowing funds from investors at interest rates of up to three - four per cent per month and on-lending them for commercial purposes.
Around 50 investors are affected, but it is too early to determine what returns might be available.
West placed the company into voluntary administration on July 24 after resolving that it was insolvent or likely to become so.
ASIC is seeking declarations of breaches of the Corporations Act and the winding up of both the scheme and the company. Its investigation into the matter continues.
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