The Australian Securities and Investments Commission (ASIC) has cancelled a financial services licence, banned an adviser and is investigating an online financial-mentoring company.
Leigh Barker, of West Pennant Hills, New South Wales, has been banned from engaging in financial services for five years after the regulator found he made false or misleading statements and engaged in misleading or deceptive conduct.
Barker is the sole director of Tangible Assets Financial Services Pty Ltd, Tangible Assets Pty Ltd and TATL Pty Ltd (formerly Tangible Assets Trading Pty Ltd).
An ASIC investigation found that between October 2008 and April 2010, Barker and his companies promoted a “parallel imports business” purportedly operated by TATL, offering investors a return of 15 per cent every three months.
A parallel-import business involves purchasing goods in one country and exporting them to a buyer in another country. In this case, the shipments usually consisted of supermarket, household and toiletry items.
Barker, Tangible Assets Financial Services and Tangible Assets distributed promotional material and made verbal statements that clearly suggested TATL operated the parallel import business. This material suggested that investors’ funds would be applied to acquire a portion of goods of a particular shipment.
However, ASIC’s investigation found that TATL did not carry on a business of parallel importing. Instead, Barker pooled the money invested in TATL and invested it in a parallel-import business purportedly run by another company, Reseau International Trading Pty Ltd.
Over 200 investors in the TATL scheme lost $12.5 million after Reseau International Trading collapsed in June 2010, owing its creditors approximately $86 million.
Tangible Assets Financial Services voluntarily cancelled its Australian Financial Services Licence in August 2011.
Morrison Carr, crashed
In related news, ASIC has cancelled both the Australian Financial Services Licence and Australian Credit Licence of Sydney-based Morrison Carr Financial Services after undertaking a surveillance of the business.
Dennis Cardakaris, the sole director of Morrison Carr Financial Services, was also permanently banned from providing financial services and engaging in credit activities.
Morrison Carr provided financial planning and credit advice via its network of 42 authorised representatives and seven credit representatives located in offices around Australia.
Morrison Carr has filed an application for review and a stay in the Administrative Appeals Tribunal (AAT) in relation to the ASIC decisions.
Cardakaris also has the right to seek a review in the AAT of the ASIC decisions to permanently ban him from providing financial services and engaging in credit activities.
Investment Intelligence all court up
The regulator has also acted to secure funds invested with an online financial-mentoring company, Investment Intelligence Corporation Pty Ltd while it investigates concerns that the company and its sole director, Senen Pousa, are carrying on a financial services business without holding an Australian financial services (AFS) licence.
ASIC has also obtained a prohibition of departure order against Pousa of Byron Bay in New South Wales.
On July 26, ASIC obtained interim orders in the Queensland Supreme Court over $3,092,799 held by St George Bank and $313,136 held by American Express Australia in the accounts of Investment Intelligence.
The matter will return to the Queensland Supreme Court for further hearing at a later date.
