Qld court appoints receiver after ASIC/US investigation
The Queensland Supreme Court has appointed a receiver and manager from William Buck over the assets of Goldsky Global Access Fund, Kenneth Charles Grace, and associated entities, following an investigation by the Australian Securities and Investments Commission (ASIC) with assistance from the United States Securities and Exchange Commission (SEC).
ASIC alleged that Grace, through his companies, operated a financial services business without holding an Australian Financial Services Licence (AFSL), despite being aware since at least this June that a licence was required.
The regulator also believed that the Grace operated an unregistered managed investment scheme, the Goldsky Global Access Fund, that had raised for than $16 million from 50 investors, and had used investor funds for his own personal use. This use included substantial payments to family and the purchase of personal items.
Grace claimed to have relief from the AFSL requirements on the basis that his firm was providing services to wholesale clients in Australia and was subject to equivalent regulation offshore. Goldsky Asset Management was authorised as an ‘investment adviser’ by SEC.
On 5 June this year however, ASIC advised Goldsky that it was no longer entitled to this relief from holding a licence as it had not complied with its conditions, and SEC then filed a civil suit against the company on 27 September.
The Supreme Court’s orders came off proceedings brought by ASIC to appoint e receiver to identify and secure the assets of the alleged scheme, with the order being made on an ex parte basis with Grace’s consent.
The matter would return to the court next week, with the receiver to provide a report by 26 November.
Recommended for you
Government has introduced a bill to Parliament to legislate the first stream of the QAR reforms.
ASIC now has a 1:1 ratio when it comes to court success in the enforcement of crypto activities and more action is expected as Treasury seeks to introduce a regulatory framework.
A leading governance body has hit out at “specialist interest groups proposing ad hoc law reform” when it comes to reforms of financial services legislation and believes an independent body is needed.
The release of ALRC’s final report into financial services legislation has highlighted financial advice as a “significant” focus as it seeks to reduce costs and help advisers understand their obligations, alongside the Quality of Advice Review.
