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July 28, 2016

ASIC bans SMSF spruiker

 

The Australian Securities and Investments Commission (ASIC) has banned Ronald Cross, of Figtree, New South Wales, from providing financial services for a period of four years.

Cross is the CEO and a director of Park Trent Properties Group Pty Ltd (Park Trent).

On November 27, 2015, further to proceedings issued by ASIC, the Supreme Court of NSW found that Park Trent had unlawfully carried on an unlicensed financial services business for more than five years by advising clients to purchase investment properties through a self-managed super fund (SMSF).

The court also permanently restrained Park Trent from providing unlicensed financial product advice to clients regarding SMSFs.

ASIC found that, as the key decision maker of Park Trent, Cross:

  • was knowingly involved in Park Trent’s contraventions, making all of its major strategic and business decisions and intended to influence clients to purchase properties through SMSFs;
  • was willing to ignore legal advice and warnings about Park Trent’s practices, demonstrating that he is likely to contravene financial services laws.

ASIC deputy chairman Peter Kell says: “ASIC’s action against Mr Cross shows that we will not hesitate to exclude property spruikers who provide unlicensed financial services from the industry.”

Cross has the right to appeal to the Administrative Appeals Tribunal for a review of ASIC’s decision.

ASIC launched legal proceedings in November 2014 against Park Trent who, by the time of the trial in June 2015, had advised more than 860 members of the public to establish and switch funds into an SMSF.

On October 15, 2015, the Supreme Court of NSW found Park Trent had been unlawfully carrying on a financial services business for more than five years by providing advice to clients to purchase investment properties through an SMSF.

Park Trent has appealed the decision to the NSW Court of Appeal and the appeal is set down for a final hearing on August 31.

 

Catch the September issue of API for the first part of our two-part exposé on property advisors and avoiding spruikers

About Angela Young

Angela Young is the Associate Editor of Australian Property Investor magazine.